According to iAfrica.com, South African internet service provider (ISP) Afrihost is close to finalising a deal to acquire the entire share capital of rival ISP Axxess DSL. The website reports that the deal should be completed by August. Afrihost and Axxess are expected to continue to operate as separate brands, eventually operating on merged platforms. Afrihost director Greg Payne commented: ‘Combining two entities like this makes the sum more valuable than the individual parts’. Meanwhile, Andrew Simpson, MD of Axxess said: ‘This was an easy decision to make. The synergies between Axxess and Afrihost are numerous, but what is more exciting for us, is what both companies can potentially achieve together. We embrace this opportunity and we look forward to some very exciting times in the future’. Afrihost CEO Gian Visser told TechCentral that the deal will not require the approval of the competition authorities. It is noted that former Internet Solutions CEO Angus MacRobert, who acquired a minority equity stake in Axxess last year, will become a small shareholder in Afrihost once the deal has been concluded. The value of the deal has not been disclosed.
According to TeleGeography’s GlobalComms Database, Axxess DSL, which is based in the city of Port Elizabeth, was founded in 1997 by Franco Barbalich, who remains an integral part of the privately owned company. Its core business involves selling simple and affordable ADSL internet services to the broader South African consumer and SME markets. Axxess initially carved itself a niche in the market as a result of former telecoms monopoly Telkom’s ‘hard capping’ policy – which saw monthly usage allowances shrink as ADSL speeds increased – creating a gap for Axxess to provide pre-paid bandwidth to consumers through a variety of accessible locations around the country – in a similar way that cellular customers can top up airtime. The move quickly earned Axxess kudos from consumers and the ISP has seen its fortunes steadily improve ever since.