Dimension Data closes in on deal to sell Mweb

Dimension Data is near to concluding a deal to sell Internet service provider Mweb, but has taken the sale of another business it has deemed non-core, Merchants, off the table for now.

This is according to newly appointed Dimension Data CEO Werner Kapp, who spoke to TechCentral in an interview on Wednesday. Kapp, who has been with the group for 21 years, succeeded Grant Bodley in the hot seat at the storied NTT-owned IT services firm on 1 April.

TechCentral first reported in January that Dimension Data planned to sell Mweb. It appointed Standard Bank to lead the sale process, according to a source at the time who had knowledge of the situation.

At the time, it was understood that Vodacom, MTN and several Internet service providers were excluded from taking part in the discussions as these companies would likely want to move the Mweb client base onto their own network platforms. It’s not known if that position has shifted at all.

Dimension Data bought Mweb just five years ago from MultiChoice Group – which at the time was owned by Naspers – in a deal reported to be worth about R130-million.

Kapp declined to comment further on the sale discussions, saying only that “there is progress on that front”.

Merchants

On the plan to sell Merchants, which hasn’t been reported in the media until now, Kapp said the process has come to an end and Dimension Data will retain the asset – for now – even though it is deemed “not strategically core”.

“It’s the biggest BPO (business process outsourcer) in the country. Its financial performance has exceeded expectations, but it’s not core… It didn’t make sense at this point in time to sell Merchants.”

Kapp said that, fundamentally, Dimension Data’s strategy will remain similar to what it was under Bodley’s leadership. Bodley, supported by outgoing executive chairman and co-founder Jeremy Ord, led a major restructuring of the business and concluded a complex black economic empowerment deal.  — (c) 2021 NewsCentral Media

Now read: Jeremy Ord steps down at Dimension Data