Actis sells South African fiber operator Octotel

Global private equity firm Actis has sold South African fiber network operator Octotel to a consortium led by African Infrastructure Investment Managers (AIIM).

The sale comes after Actis announced that it would be acquiring Telkom South Africa's masts and towers business, Swiftnet, for 6.75 billion South African rands (US$357 million at the time).

Led by AIIM, the consortium comprises STOA, an impact investor in infrastructure and energy, and Thebe Investment Corporation, a South African Black-owned and Black-managed investment management company.

The conglomerate is also acquiring a minority stake in Internet service provider RSAWeb. However, both transactions are subject to customary regulatory approvals and closing conditions.

Actis said it invested in Octotel in 2020 to capitalize on the growing demand for high-speed connectivity and the rapid rise in data consumption in the country.

It added that its investment strategy focused on expanding the number of homes passed with a fiber line and driving the take-up rate on the network.

"This resulted in significant growth for the platform, with the number of homes passed with fiber rising from 195,000 at investment to 350,000 today, and the number of customers connected increasing from 56,000 to 110,000 over the same time period," Actis said in a statement.

"The sale of Octotel adds to the strong track record Actis has in digital infrastructure," Actis partner David Cooke said.

"Together with the exceptional management team, we have been able to scale the platform and generate significant returns for our investors while driving positive social impact," Cooke added.

Exciting times for Octotel and RSAWeb

Octotel CEO Trevor Van Zyl said joining forces with AIIM, STOA and Thebe marks an exciting chapter for Octotel and RSAWeb.

"Together, we are poised to accelerate our mission of delivering cutting-edge connectivity solutions, bolstering economic growth, and fostering innovation across the region," Van Zyl said.

Octotel CEO Trevor Van Zyl. (Source: Octotel)

Launched in 2016, Octotel is regarded as a key player in the fiber-to-the-home (FTTH) and fiber-to-the-business (FTTB) markets, contributing to the digital infrastructure of the Western Cape province of South Africa.

"We are thrilled with the acquisition of Octotel and RSAWeb and look forward to empowering their world-class management team to continue to drive connectivity in the Western Cape and contribute to the ongoing digital transformation in South Africa," said AIIM Investment Director Thor Corry.

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STOA CEO Marie-Laure Mazaud said the transaction reinforces STOA's long-term commitment to the deployment of affordable, reliable and fast connectivity in Africa.

"Through this transaction, we aim to play our part in expanding the high-speed fiber network into greater parts of the Western Cape," concluded Thebe Chief Investment Officer Rapulane Mabelane.

*Top image source: Image by Freepik.

— Matshepo Sehloho, Associate Editor, Connecting Africa