Cornastone has acquired 25,01% of ACI South Africa, the local operation of electronic payments systems company ACI Worldwide, in a BEE transaction for an unspecified sum of cash. This will be settled over a period of time through a structured payment schedule.
The transaction has been enacted through the creation of a special purpose vehicle (SPV), ACI Worldwide Cornastone, to which ACI has sold its South African subsidiary. Cornastone acquires 25,01% of the SPV, with ACI retaining the balance.
"This brings us in line with the realities of the South African market, and will help make us more competitive," says Daryl Berg, MD of ACI South Africa.
"However, this is not just another BEE transaction. We are fully committed to transformation, and we needed a partner to help us develop our local business with banks and government, to enhance our services capacity, and reduce the cost of post-sales support in sub-Saharan Africa. Cornastone was that company.
"Cornastone and ACI will move closer to each other," Berg adds. "We will have a joint board, career mobility between the two companies, a mentoring programme, and we will be making use of Cornastone staff to provide technology development skills and support across our Europe, Middle East and Africa regions. In addition, Cornastone will assist us with progress towards compliance with the other pillars of the BEE codes."
Hamilton Ratshefola, CEO of Cornastone Consulting, says: "It opens up huge opportunities for us and brings us closer to fulfilment of our overall strategy. It strengthens our banking application portfolio, and makes Cornastone ACI's de facto delivery arm in Africa. As an initial requirement, we will employ and train up six new engineers immediately."
ACI will make full use of Cornastone's engineers as part of an overall strategy to use regional and lower-cost resources.
"Our approach is wherever possible to deploy people from developing markets. Ultimately, we also aim to use Cornastone skills globally, where possible," says Berg.
In addition, Cornastone has been appointed as a distributor of ACI products in South Africa and may engage in business development in sub-Saharan Africa.
In time, ACI may also use Cornastone for development skills through DVT, the JSE-listed company in which Cornastone has a 25% stake.
"ACI understands the unique requirements of the South African market," says Berg. "We knew it was a critical requirement for our continued presence locally and we engaged consultants to help us find the right investment partner. Cornastone presented an ideal fit with its range of hardware and software offerings, and its nationwide skills base."