For anyone doing business in South Africa, Broad-Based Black Economic Empowerment(B-BBEE or BEE) is unavoidable, and your BEE status determines a lot in terms of your potential growth as a company.
Implemented by the South African government as a vehicle to effect economic change, primarily aimed at addressing the unequal distribution of wealth across race and gender, it’s still regarded by many as a grudge purchase as they feel it hampers entrepreneurship and stifles competition. But a lot of good has come from BEE and the judicious research by companies and NPO/NGOs who have sought out complementary partnerships. One such relationship is between The Love Trust and Networks Unlimited (recently acquired by European based Exclusive Networks).
Effective, sustainable, and well managed NPO/NGOs with the means to invest a portion of their funds to help supplement their income in the form of dividends and shares. The more talented the fund managers that represent the interests of the NGOs are at identifying the right business to invest in, the larger their return. Through The Love Trust’s investment arm, the Lily Investment Trust (LIT) has equity investments in a small portfolio of companies (Networks Unlimited being one of them) and all funds generated through these investments flow through to The Love Trust.
We spoke to Anton Jacobsz, CEO of Networks Unlimited Africa, about their relationship with The Love Trust, their journey through the acquisition process by an international company and the impact this will have not only for them but their stakeholders as well.
From its humble beginnings as a single product reseller, run from Wayne Bird and Craig Copeland’s garage in Harfield Village 27 years ago, Networks Unlimited has grown into a multichannel, valued-added IT distribution company of specialist Cyber Security products. The road has had its ups and downs with a near-fatal blow in 2008 when they lost their flagship product. The company has since diversified its portfolio to sustain product loss and expanded its market base to include the rest of Africa. According to Jacobsz, “we registered our African Head Office offshore in Mauritius, which does all our business across the continent of Africa in the required currencies. We now have offices in Mauritius and Kenya and are in the process of opening new offices in Nigeria. We also have teams currently in Nigeria, Ghana, Madagascar, Botswana, and Uganda. So, we’ve created a good footprint across Sub-Saharan Africa. As a result, our business has grown by a factor of 10 over the last 10 years. We have done exceptionally well, and I think it’s one of the reasons that we were acquired by someone like Exclusive Networks.”
What does this acquisition mean for the company and its stakeholders? After nearly two years of negotiation, two audits, and months of planning and restructuring, Networks Unlimited (Exclusive Networks Africa) is about to become a force to be reckoned with. “What it’s going to do for our business and our partner’s business, is massive,” says Jacobsz, “the footprint, the contracts with the Global Systems Integrators and Telco’s are just the tip of the iceberg. 18 Months ago Exclusive had no representation across Sub Saharan Africa . We now fix the rest of that map for them. And what this means, is that all those entities who do rollouts across Africa and into Europe, who have what they call NOC’s or data centres, that require a managed service for logistics, technical skills and support for these rollouts can look to us for support. It places us as moving from locally relevant to globally