BUSINESS NEWS - Internet Solutions (IS) is, according to Bloomberg, in talks to buy Dark Fibre Africa (DFA) from Remgro, majority owner (51%) of DFA-parent Community Investment Ventures. The report last week suggested that the sellers want as much as R10 billion for the fibre network operator.
But why would Internet Soutions (owned by NTT unit Dimension Data) want to own a metro fibre network?
For a start, in a mobile-first, cloud-first world, high-speed fibre connectivity is gold. And the rush to blanket (and connect) as much of the world with fibre is this century’s goldrush. In South Africa, there are few networks that would rival DFA’s.
Telkom (primarily via subsidiary Openserve) leads the way with somewhere north of 150 000 km of fibre in the ground (the most recent publicly-disclosed figure is more than two years old). Mobile operators, Vodacom and MTN, have decent fibre footprints in some metro areas, but these are likely in the low single digit thousands of kilometres in length (neither discloses this data).
On the face of it, Neotel’s network is impressive, but more than half of it comprises long-haul routes (mostly bought from Transtel). In metro areas, DFA’s footprint is more extensive. That said, Neotel’s network (and access to scarce wireless spectrum) was attractive enough for Vodacom to try buy it for R6.5 billion in 2014.
The deal dragged on for two years and was eventually dropped by Vodacom, which cited regulatory hurdles (a massive alleged bribery scandal involving Neotel and Transnet certainly didn’t help).
