EQUITY INVESTMENTS
VenFin has significant minority interests in the following investments and provides strategic guidance to these companies through board and subcommittee representation. We are a medium to long-term investor in these companies with the intention of realising returns that meet or exceed our cost of capital.
DIMENSION DATA | SABIDO | TRACKER | PSITEK | SAIL | KALAHARI ENERGY | CDMTV | VHF | TRINA SOLAR | JOHANNA SOLAR
MOSMART | CASH AXCESS | FUNDAMO | CUEINCIDENT | FRING | FYNBOS MEDIA | DESTINY | FRAXION | i to i
Dimension Data’s expertise lies in the technology areas of networking, security, Data Centres and Storage (DCS), contact centres and Microsoft environments. The company applies its skills in consulting, integration and managed services to create customised client solutions. It is a global leader in the field of simplifying and consolidating IT infrastructures through Internet Protocol (IP) convergence.
With expected revenues in excess of US$3.5 billion in the current financial year and close to 10 000 employees in over 35 countries, Dimension Data has a global footprint that supports highly personalised regional execution, while leveraging the domain experience and depth of a global business.
In December 2002, R&V Technology Holdings Limited (R&V), a wholly owned subsidiary of VenFin, subscribed to a US$100 million seven-year convertible bond issued by Dimension Data. RFS Finance Limited, a wholly owned subsidiary of VenFin, subsequently acquired 93 970 485 shares in the open market, representing a shareholding of 7% in Dimension Data. In April 2006, R&V elected to convert the US$100 million convertible bond into 188 121 978 ordinary Dimension Data shares. On conversion, the additional shares amounted to 12.2% of the enlarged issued share capital of Dimension Data, bringing VenFin’s total equity interest in Dimension Data to 18.2%.
Overview of the six months to 31 March 2007
Dimension Data reported another period of excellent progress in the first half of 2007. Revenue growth was robust at 22% and returns improved significantly, with operating profit up by 50% to US$55 million. Earnings per share doubled to 1.8c. The company’s growth in revenue was fuelled by solid demand and performance across all its lines of business.In Dimension Data’s most significant line of business, Network Integration (46% of group revenues), revenue growth of 21% was supported by a strong demand for core network upgrades, particularly among the multinational and global accounts.
Strong performances were also reported from the other global lines of business: Converged Communications, Security, Customer Interactive Solutions (CIS), DCS and Microsoft Solutions. The Solutions business now accounts for 32% of revenue, up from 30% in the comparative period, and provides exposure to highgrowth markets where Dimension Data is well positioned to compete. The 64% growth in Converged Communications was driven by continued strong demand for IP Telephony solutions. Security convergence onto the network underpinned a 16% increase in Security revenues and good progress was made in the DCS businesses, where revenues increased by 19%.
Growth of 25% in Dimension Data’s regional lines of business (22% of revenues) was underpinned by an exceptionally strong demand for the group’s pan-African mobile infrastructure services and a good performance from Internet Solutions, following strong growth in its Virtual Private Network offerings, pan- African networking and hosting services.
Dimension Data enjoyed solid growth in both services and product turnover. Momentum in product revenue growth was aided by enhanced product delivery, which remains a key component of its integrated solution offering. Growth in Services revenues accelerated during the period, with an enhanced ability to attach services to product sales and the Global Services Alliance, with Cisco helping to drive growth.
Good double-digit growth was achieved in four of the five regions in which the company operates, with particularly strong growth reported from Africa (48%), Europe (22%) and Australia (18%). Operating margins improved in all regions and a pleasing turnaround was reported from Europe. A slightly stronger gross margin, reflecting firmer product margins and stable service margins, combined with an ongoing focus on costs, improved the operating margin to 3.1% from 2.5% in the prior period.
Good progress was made in reducing the company’s effective tax rate further; down to 29% from 36% in the first half of 2006.
Group cash and cash equivalents totalled US$352 million at the end of the reporting period (2006: US$342 million), reflecting business growth as well as improved working capital management.
BEE
The black economic empowerment equity transaction concluded by Dimension Data’s South African subsidiary in 2004 continues to deliver pleasing results and a further 4.9% was vested for the year to September 2006, which brought the total amount vested to 9.2%.The future
Dimension Data’s strategy of investing in both its lines of business and services is delivering results. The group will continue to invest to ensure that they capture the market opportunity early on and thereafter build returns through scale and efficiency gains as markets move to maturity. The group plans to continue to invest in service offerings, systems and processes to drive operational excellence and standardisation. Whilst the growth strategy remains primarily organic, they will make selective acquisitions to secure future growth from important new markets.Dimension Data remains ideally positioned to benefit from significant market trends, including the continued adoption of IP-based infrastructure and the implementation of the converged network. There will be a continued focus on driving improved profitability ratios through efficiency and scale benefits, which will be combined with a close focus on the overhead base. Dimension Data remains optimistic about its ability to deliver long-term value to our shareholders.
Overview of the year to 31 March 2007
- e.tv
e.tv maintained its position as the largest English-medium television channel in South Africa and the second most watched channel overall. During the period under review, the channel averaged a 24-hour market share of 21.9% and a prime time (18:00-22:00) market share of 18.6%. e.tv has continued to grow its market share among the black middle class, particularly among the celebrated ‘Black Diamond’ group.
Programming costs remained stable. Prime-time news, films, wrestling and the daily local drama Scandal command the highest audience ratings. Television advertising spending continued to grow significantly and e.tv reflected a 30.4% growth in revenue year-on-year. e.tv’s eight-year broadcasting licence was renewed at the end of 2006. In pursuing its strategy to become a multi-channel business, e.tv has been involved actively in the development of a national policy for the introduction of digital terrestrial television in 2008.
- Other Sabido projects
Sabido pursued potential investments in free-to-air television and radio broadcasters in various African countries and acquired interests in other media platforms within South Africa. Sabido has a 39.6% shareholding in Cape Town’s Dreamworld Film Studios development and is in the process of investing in several entities complementary to its core business.
BEE
e.tv is a fully black empowered company in both ownership and employment, and has exceeded its employment equity objectives. 74% of its employees are black, 46% are women and 5% are disabled. e.tv spends in excess of 5% of its salary bill on training and has established in-house training programmes for historically disadvantaged individuals in middle-management positions.The future
Sabido’s vision is to leverage e.tv’s market position to develop a compelling content production and distribution business with a pan-African focus.
Tracker’s contract partnership with the South African Police Service (SAPS ), in terms of which Tracker’s technology is used to track and recover stolen vehicles throughout South Africa, has proved highly successful. Since its inception in 1996, more than 34 000 stolen vehicles have been recovered, 6 500 criminals arrested and 280 chop shops and vehicle syndicates exposed through the usage of Tracker technology.
The product range currently comprises three products, namely Tracker Retrieve (stolen vehicle recovery system), Tracker Alert (Retrieve plus an early alert enhancement) and, as from 1 June 2007, Skytrax (internet-based fleet monitoring system with stolen vehicle recovery capabilities).
Overview of the year to 30 June 2007
Tracker had a successful year with 19% growth in operating profit, 24% growth in net subscribers and strong cash flow. During the year Tracker installed almost 100 000 units, while its subscriber base increased to 420 000 vehicles.During May 2007, Tracker acquired 100% of Mobile Data, a vehicle monitoring and telematics company, previously 50% owned by WesBank, and offering a product range known as Skytrax. Tracker also acquired the technological expertise and intellectual property relating to the Skytrax technology.
As a result of the transaction WesBank holds a 32.5% stake in Tracker, with VenFin owning 31% and the Mineworkers Investment Company (MIC) increasing its shareholding to 26.5%. The remaining 10% of the equity is held by a private investment consortium.
This transaction has the potential to make Tracker the leader in vehicle communication in South Africa through stolen vehicle recovery, vehicle monitoring and telematics.The Mobile Data acquisition will increase Tracker’s database by some 49 000 to 469 000 vehicles, making it the largest vehicle communications company in South Africa. Tracker now offers a fully comprehensive service catering to the needs of individual vehicle owners, small businesses and fleet operators. Furthermore, Tracker is in a position to offer further value to certain business intermediaries, such as vehicle manufacturers, dealerships and insurance companies, by being able to provide them with vehicle information to improve their service offerings.
The Mobile Data acquisition brings advanced GSM/GPRS vehicle monitoring technology and telematics to Tracker, and will strengthen Tracker from an intellectual capital perspective. The transaction will see 130 Mobile Data staff joining Tracker, making the company a direct employer of over 1 100 staff countrywide.
BEE
MIC has been an investor in Tracker since 2000 and, prior to the Mobile Data transaction, held a 25% interest. MIC has increased its shareholding to 26.5% through the purchase of some shares previously held by the private investment consortium.The future
Tracker operates in a highly competitive market. As insurers increasingly insist on the installation of stolen vehicle recovery devices as a requirement for vehicle insurance, the pressure on service providers to offer lower-priced solutions is increasing. Tracker’s management is responding to this challenge by driving down input costs, while still investing in its systems to maintain the highest possible recovery rates as well as excellent customer support services. The transaction with Mobile Data provides Tracker with a complete vehicle communications suite, broadening its potential customer base.
Additionally, Psitek’s strategy of creating independent, strong and visible product and service brands has resulted in a number of preferred brands in the supervised payphone segment and the fixed wireless terminal segment. New service brands were recently launched for service centre support and for providing access to content and data services. Psitek has a strong product development capability. The company distributes and supports its products around the world and has a wholly owned manufacturing facility.
Overview of the year to 30 June 2007
Psitek recorded improved financial results for the period under review due to the implementation of various strategic initiatives to improve market penetration and profitability. The consolidated turnover for the period was R316.5 million (2006: R249.8 million).The company operates in a number of foreign regions and has established a physical representation in a number of countries, including Mexico, Algeria, DRC, Nigeria and Kenya. The regions are managed from the Cape Town head office by regional heads who are responsible for driving market activity and setting up support structures in their regions. Partnerships and strategic relationships with clients continue to be key focus areas of the marketing and sales teams.
At the product creation end of the business, innovation and product development remain key factors that will allow the company to grow market share in existing markets and to create market opportunities in new areas. A great deal of development effort is spent on lower-cost, higher-specification products for existing markets. This should provide clear and sustainable product differentiation and allow the regional sales teams to compete well against lower-cost imported products with a lower functionality. At the same time, a number of development teams have been developing new product lines to drive new revenues and to support strategies for generating revenues from value-added services deployed across the product base.
BEE
Psitek was restructured during the prior financial year to cater for envisaged international and local partnership requirements. Two empowerment deals were concluded within its South African interests during this period.In the first empowerment deal, 25% of the shares in Elprom, Psitek’s electronic goods manufacturing facility in Stellenbosch in the Western Cape, were made available to employees in a broad-based BEE initiative. This transaction significantly raised the BEE profile of the company and the group. The second deal relates to Psitek South Africa, where 20% of the company was sold to Regiments Capital under the leadership of Litha Nyhonyha.
The future
The outlook for the new financial year is moderate, with management balancing the need for financial performance against certain long-term initiatives which are only expected to bear fruit in future periods. Psitek will have a strong focus on creating new growth revenue streams from annuity-generating business models. Growth is also expected in the traditional channels with existing and new products and solutions.
SSE creates brand value for its corporate clients through conceptualising, implementing and managing sponsorships and events on behalf of clients.The business unit also sources branded and promotional items for its clients.
Circa focuses on commercialising hospitality rights to sport and entertainment events, and the provision of hospitality-related infrastructure and equipment rental services.
Navitute focuses on owning events, player management, commercialising events and properties, and providing consulting services and outsourced management services within the sport, leisure and entertainment industries.
Investments include Blue Bulls Rugby (Proprietary) Limited (50%), Western Province Rugby (Proprietary) Limited (24.9%) and Silverton Travel (Proprietary) Limited (Edusport Travel) (25.1%).
Overview of the period to 30 June 2007
SAIL continued to produce growth in revenue and earnings from its core businesses. The group acquired the rights to the Vodacom Challenge soccer tournament and secured the appearance of Manchester United in the 2006 tournament.SSE was appointed by the Gauteng government to manage its sports sponsorship for two years. The Blue Bulls’ success on the field translated into positive growth in earnings. Edusport Travel continues to achieve significant growth in revenue from incentive travel to international sporting events.
In line with its strategy to disinvest from its non-core businesses, the group disposed of its investment in Eagles Rugby (Proprietary) Limited, Eastern Province Rugby (Proprietary) Limited and Border Rugby (Proprietary) Limited.
BEE
The Competition Commission sanctioned the sale of SACTWU’s equity interest in SAIL to Vuwa Investments (Proprietary) Limited during December 2006. The new equity partner, headed by Bulelani Ngcuka, has made a positive contribution to SAIL from a strategic, alliance and networking perspective and, consolidated its relationship with other stakeholders of SAIL. Vuwa owns 36.1% of SAIL.The future
SAIL continues to benefit from extended opportunities among its existing clients. SAIL obtained additional partners for the Vodacom Challenge soccer tournament and secured the appearance of Tottenham Hotspur in the 2007 tournament. The tournament will extend for a further three years and SAIL has secured the appearance of Manchester United in the 2008 tournament.
Independent resource projections show that large quantities of CBM are available in Botswana for exploitation, which could impact significantly on the energy sector in Southern Africa.
Overview of the year to 30 June 2007
The results from the KE trial wells that monitor gas yield trends exceeded expectations. The year culminated in a transaction with Saber Energy Corporation (part of the Canadian-based Tau Capital Group), who will develop gas well fields for the purpose of electric power generation (power to be supplied into the South African power grid) on a number of selected licence areas.The future
A number of ‘farm-in’ transactions are being negotiated with various multinational resource companies to ensure that the licence areas under KE ’s care are exploited optimally. These agreements are expected to be concluded by the end of 2007. In addition, KE is pursuing a number of energy-related projects of its own accord. It is anticipated that the first commercial well field will be operational within three to five years.
CDMTV supplies advertising space on digital mobile television channels. The ad time is sourced from its network of state-owned city and provincial broadcasters, each of which enjoys a local monopoly on digital mobile broadcasting. The ad time is supplied to a wide range of vendors of consumer goods and services, either directly or through their advertising agencies. The TV channels are broadcast to LCD screens, principally located in buses.
In China the standards for the digital mobile TV industry have only recently been set by the government. Each city in China has been granted one frequency to broadcast mobile TV programming. While digitalmobile media is a relatively new channel of advertising, its wireless real-time broadcasting feature and captive viewing environment (e.g. in buses) have been increasingly attracting attention from advertisers. Currently TV and outdoor media combined account for over 84% of the total advertisement spending in China. It is expected that digital mobile media, being a hybrid of the two forms, will take market share away from both traditional TV and traditional outdoor media.
The future
CDMTV is at a start-up stage, but has the potential to become the largest digital mobile media advertising network operator in China. Currently its network reaches 26 cities in China, including Beijing, where the Olympic Games will be held in 2008.
The VHF product is a flexible photovoltaic (PV) solar cell, as opposed to the well-established rigid crystalline silicon solar panels on a glass substrate, which currently comprise 90% of the PV market. Owing to its highly flexible substrates, VHF is able to deliver innovative solar consumer products (e.g. rollable battery chargers) and to provide integration solutions for the building industry and industrial OEM markets.
VenFin invested CHF3.2 million in VHF, which is still in a product development phase. The investment in VHF is one of three that VenFin has made to date in the solar industry.
Overview of the year to 30 June 2007
In June 2006, Q-Cells AG from Germany, the second largest manufacturer of crystalline silicon-based solar cells in the world, made an investment of CHF10.8 million in VHF. In addition to the expansion of its core business of crystalline silicone cell manufacturing, Q-Cells has made five investments in thin-film PV technologies, one of which is VHF. In February 2007, Q-Cells exercised its option to increase its shareholding in VHF to 51%. The new capital injection will enable VHF to increase its production capacity in Yverdon from 100 kW to 5 MW. This increased capacity will be focused on the consumer market.In May 2007, Q-Cells and VenFin agreed to invest in a 30 MW factory to be built in Thalheim, Germany. VenFin’s commitment to this project is €9 million, which will result in a small increase in its VHF shareholding to 16.7%.
The future
The upgrade to 5 MW in Yverdon is expected to be completed by March 2008, which will allow VHF to start servicing the pent-up demand for consumer-type PV products in 2008. The 30 MW factory in Thalheim is dependent on the approval of government incentives and will take approximately 18 months to construct. The VHF product’s main competitive advantages are, firstly, the fact that the product is lightweight and flexible, allowing for total integration on building elements of various shapes and enabling roll-to-roll manufacturing; and secondly, the cheaper plastic substrate that is used, which should provide a substantial reduction in the cost compared to glass substrate panels.
In May 2006, VenFin invested $1.5 million for a 1.3% direct shareholding in Trina Solar as part of a consortium led by the Milestone China I Fund that invested a total of $40 million for a 34% shareholding. These proceeds, together with cash raised during a very successful initial public offer (IPO ) on the NYSE in December 2006, are being used for establishing cell manufacturing capacity and working capital.
In June 2007, VenFin sold 14% of its direct shareholding in Trina Solar at an effective price of US$43 per American Depository Receipt (ADR), compared to the US$7 per ADR paid in May 2006. The ADRs traded at US$54 at the end of June 2007, which translated into a US$1.4 billion market capitalisation for Trina Solar.
Trina Solar currently sells its products to customers in Europe, Taiwan and China.
Johanna Solar will use a CIGSSe (copper indium gallium sulphide selenium)-based silicon-free technology, developed by the Johannesburg University and Professor Vivian Alberts. Johanna Solar has entered into a global (excluding Africa) manufacturing licence agreement with the university, allowing the company to sell sublicences outside Africa.
The benefits for the CIGSSe technology are similar to other thin-film technologies. The licensor of Johanna Solar believes it has a higher conversion efficiency of sunlight to electricity compared to most other thinfilm technologies.
VenFin is also one of three promoters of a current feasibility study for a PV manufacturing facility in South Africa based on the same technology used by Johanna Solar. Should this study prove successful, construction of such a plant may commence in 2008.
Overview of the year to 30 June 2007
Mosmart commenced the management of a palm oil plantation in Guinea during the last year and upgraded and expanded the production facilities. A biodiesel production facility will be commissioned during the third quarter of 2007. The preceding twelve months saw significant progress in the development of an organic medium for the absorption of pollutants, concurrent with discussions with a multinational enterprise for utilisation in a specific application. Mosmart’s current focus is on the protection of the intellectual property.The future
Mosmart will be split into two independent entities, with biodiesel activities moving offshore and products relating to intellectual property remaining in a South African vehicle. Business plans to expand the biodiesel activities to two other African countries within the next year are already being developed. Significant off-take agreements regarding proprietary products are anticipated to be concluded within the next 12 months.
Cash Axcess is an authorised distributor in South Africa of the Tidel 3000 series of ATMs. The company uses a number of innovative techniques to reduce the total cost of ownership of its ATMs, such as GPRS communications, retailer cashing and the recycling of cash from drop safes.
Cash Axcess is an early-stage company. The company entered into an acquiring relationship with Mercantile Bank in January 2005 and took its first ATM live in March 2005. In July 2005, Cash Axcess started deploying ATMs nationally and entered into an acquiring relationship with Capitec Bank in March 2006.
Overview of the year to 30 June 2007
During the past financial year, COIN Security acquired a 50% stake in Cash Axcess, while VenFin holds the remaining 50%. The company focused on expanding its ATM footprint and its client base during the year. In July 2006, Cash Axcess piloted the recycling of cash from drop safes via its ATMs through a contract with COIN Security. This unique service is now offered to the Cash Axcess clients, and the company is currently preparing to deploy ATMs using this model with a number of banks in South Africa.BEE
COIN Security Group has a 50% shareholding in Cash Axcess. COIN Security is a wholly owned subsidiary of Mvelaphanda Group Limited, a pre-eminent broad-based, black controlled, owned and managed group in which historically disadvantaged persons have a 57.6% total effective shareholding.The future
Cash Axcess seeks to conclude additional bank acquiring agreements in South Africa to increase its existing ATM base. It is committed to continually improve the quality of service provided by its ATMs. The company believes that there are significant opportunities in the market to deploy lower transaction volume machines in previously underserved areas.
Based on the rate of adoption, analysts’ predictions and the sheer demand for mobile banking and payment services, this industry migrated from entrepreneurial fringes to the corporate mainstream.
Overview of the year to 30 June 2007
During the past year, a number of important announcements catapulted the mobile banking industry into the spotlight. During February the GSM Association, in collaboration with MasterCard, announced support for international money transfer by making use of mobile phones. Mobile payment volumes started increasing significantly in countries like Japan, South Korea and the Philippines.In Africa initiatives like MTN banking and Celpay (DRC) received big media exposure. The USA market started picking up momentum too with various announcements.
Both MTN banking and Celpay reported good growth in subscriber numbers and volumes of transactions. Celpay (Zambia) reported a growth in revenue to a point where 2% of the country’s GNP is now being managed on the Fundamo system deployed in Lusaka. MTN banking made some adjustments in its business model and distribution strategy and is now growing rapidly.
During the period, Fundamo also sold licences to clients in the Middle East and North America and expects to increase market share in these markets next year. On the back of this increased activity, Fundamo’s turnover grew as expected. During the year, Fundamo raised R36 million (US$5 million) from Mark Shuttleworth’s venture fund (HBD) for product and market expansion. Fundamo also won a number of awards during the past period, amongst others the Frost and Sullivan technology leadership award as well as qualifying as one of South Africa’s Top Technology 100 companies for the sixth year in a row.
The future
In the new year, Fundamo’s management will implement strategies to ensure sustained growth. The delivery capacity will be extended as many more deployments of the technology are envisaged in the new financial year. Fundamo will also extend the product features to stay competitive and will also review new commercial models.
Overview of the year to March 2007
During the year ended March 2007, the company responded to a number of opportunities in both the private and public sector. Cueincident had better success in terms of the private and corporate sectors and mixed success in the public sector. On the corporate front the company has secured contracts with significant industry players, including Transtel and MTN, for ongoing fibre-optic installations. Cueincident also installed – and now operates and maintains – a residential surveillance security system at the Mooikloof Estate in Pretoria. Although currently small, these recurring contracts have growth potential.Uninet and Cueincident have entered into a memorandum of understanding to roll out a wireless system in Johannesburg, which will interface with Cueincident’s fibre-optic network. This would allow for the independent roll out of commercial broadband services in Johannesburg. Furthermore, it will make it possible to fully exploit the demand for wireless surveillance systems. These systems have been requested by some of the companies in the City of Johannesburg, for example the Johannesburg Development Agency (JDA) and retailers such as the JD Group. Cueincident has progressed to the second phase of the threephase City of Johannesburg broadband project, the value of which exceeds R60 million.
BEE
Mvelaphanda Capital (Proprietary) Limited and Circle Capital Technologies (Proprietary) Limited are Cueincident’s BEE shareholders, with see-through BEE ownership of 44.5%.The future
A lot of effort has gone into repositioning Cueincident for future growth prospects. The potential positive outcome of any of the major opportunities being pursued will have a major impact on the company’s financial viability and future prospects.Partnerships such as the one with Uninet are now starting to bear fruit, making it possible to offer potential clients a complete solution – from access control to CCTV surveillance systems. Recent co-operation agreements with companies like Reunert/SACO Systems enabled the two companies to jointly tender for a Uranium mine proposal.
fring offers its clients easy communication with all their fring, Skype®, MSN® Messenger, Google Talk™, Twitter and regular phone contacts from a single integrated contact list. fring supports SkypeOut and hundreds of SIP-based services, enabling cheap local and international VoIP calls to contacts’ PCs, mobile phones and landlines. fring is also enhanced with real-time contact availability (presence) so users can see who is available before dialling.
fring roams between Wi-Fi and 3G networks while bypassing traditional mobile voice and SMS messaging services, mobile-to-mobile calls, mobile-to-landline calls, and mobile-to-PC calls, including integration into Skype, MSN Messenger and Google Talk. The patent-pending peer-to-peer mobile VoIP technology delivers full-duplex voice quality with rich internet functionality and maximum network efficiency.
Overview of the year to 30 June 2007
During the financial year, VenFin participated in extending a convertible bridging loan to fring alongside, among others, Veritas Venture Partners (Veritas), a founding shareholder in fring.
Overview of the year to 30 June 2007
During its first year of operations, Fynbos Media acquired a 25% shareholding in The Grape Company, an exporter of table grapes. In October 2006, the company applied for shares in the empowerment transactions initiated by Naspers Limited involving two of its unlisted subsidiaries, MultiChoice Africa and Media24. Fynbos Media was eventually successful in acquiring 10 684 shares in Phuthuma Nathi (an empowerment vehicle with a 15% equity holding in MultiChoice Africa) at a cost of R106 840 and 800 000 shares in Phuthuma Nathi 2 (the empowerment vehicle with a 7.5% equity holding in MultiChoice Africa) at a cost of R8 million.BEE
Fynbos Media is a black controlled business with 68% of the shares held directly or indirectly by four black individuals. The company will continue to evaluate investment opportunities with the aim of establishing BEE partnerships.
Overview of the year to 30 June 2007
The year under review saw a significant increase in business activity, with Destiny concluding the following transactions:- a 57% interest in Thermaweld Industries (Proprietary) Limited, a supplier of welding equipment and associated gases
- a 33% interest in Specpharm Holdings (Proprietary) Limited, a manufacturer and distributor of pharmaceuticals
- a 75% interest in Koenigsegg Automotive, an importer and distributor of the Koenigsegg supercar.
BEE
Destiny is a black controlled business that was started by a group of young black professionals with investment banking experience.The future
Destiny intends to continue with the expansion of its investment portfolio through a number of high-value transactions under consideration.
The company operates from South Africa and the United Kingdom and generates revenue from licence fees and services associated with its spend management software solutions.
Overview of the year to 30 June 2007
The Fraxion software is aimed at medium and large organisations and has been deployed in divisions of several prominent companies over the last year, including Mr Price, African Alliance, Perishable Products Export Control Board (PPECB), Woolworths, ATKV and Standard Chartered Bank.The company concluded a ‘White label’ agreement with Compass Group plc, which secured Chevron, De Beers and Siemens as clients. This ‘White Label’ solution is the only facilities management focused solution in the world.
Fraxion Version 3.1, released in March 2007, includes multi-currency and tax functions to support the company’s international expansion. Support for deeper integration into target ERP platforms is due late in 2007 through to mid-2008.
Fraxion received several awards over the past year, including a Department of Trade and Industry’s grant (SPII) and a Department of Science and Technology award for the most innovative emerging company in South Africa.
BEE
Fraxion has actively partnered with several BEE organisations. As part of its enterprise development programme, Fraxion sponsored the African Information and Communication Technologies (ICT) Achievers Award and the Institute for Local Government Managers with software donations. Fraxion will consider BEE ownership once the company has reached a more mature stage of development.The future
As the Version 3.1 solution enhanced significantly the functionality of prior versions, Fraxion is expanding its direct sales capacity in both South Africa and the United Kingdom. Shareholder funding for this expansion has been secured and DTI grant funding (Innovation Scheme) has been secured for research and development activities. In the longer term, Fraxion will look to build a reseller-orientated sales strategy.
Overview of the year 30 June 2007
The focus during the financial year was in two areas. Firstly, time was spent on the further consolidation of the underlying merged businesses, resulting in reduced duplication of functions and improved operational efficiency. In the second instance, progress was made in the standardisation and tighter control around core offerings coupled with investments into new industry growth areas.BEE
i to i technologies has a 45% ownership by black investment companies Circle Capital Ventures, Ehlobo Holdings and Imphandze Technologies.The future
i to i plans to grow its market position by focusing its sales and operational capacity on specific preselected market segments. Value to customers will further be enhanced by partnering with local and international vendors.