Following the announcement last month of T-Systems' acquisition of arivia.kom, the companies officially signed the deal yesterday.
As part of the agreement, T-Systems South Africa will acquire 100% of the shareholding in arivia.kom, previously owned by state-owned enterprises Eskom and Transnet, while simultaneously taking over the IT service contracts for both SOEs for a contract period of five years. Eskom and Transnet are arivia.kom's largest customers.
The agreement comes after a rigorous and extensive selection process which examined tenders from a number of leading ICT companies. The contract, which starts in January 2010, will deliver substantial cost and business efficiencies to the SOEs through economies of scale and the transfer of core processing and support activities required to run Eskom and Transnet’s IT environments.
“We are very excited about this opportunity," says Mardia van der Walt-Korsten, MD of T-Systems. "Not only does it mark a significant milestone in T-Systems’ long-term growth strategy, but it also affords us an opportunity to be part of enhancing the IT operation of two of the most important contributors to the success of our economy. We are committed to building long-term, mutually beneficial relationships, as well as delivering continuous improvements through the services we offer.”
In 2006, Eskom and Transnet embarked on a strategic restructuring process with the objective of disposing non-core business which included their respective shareholdings in arivia.kom. The resulting tender was aimed at selecting a leading ICT services provider that could take over the IT services contracts, as well as the shareholding in arivia.kom
Dr. Steve Lennon, MD of Eskom’s Corporate Services Division says: “For Eskom, this is an important milestone, a step in the right direction. In these challenging times of our company’s history, it is important for Eskom to focus on its core business. Awarding our IT support contract to a reputable provider whose capabilities outperform our own, and who can deliver enhancement and innovation at a lower cost will deliver benefits to our enterprise in the form of improved service levels and savings that can then be reinvested in other initiatives.“
Chris Wells, acting CEO of Transnet, adds: “We are pleased to finally conclude the deal with T-Systems. Transnet’s focus is to obtain a more cost-effective service, improved infrastructure availability and stability and enhanced end-user experience.”
The acquisition has been financed by T-Systems South Africa's principal, Deutsche Telekom, and the South African operation shall retain its 30% Black Economic Empowerment structure.
In addition to the Eskom and Transnet accounts, T-Systems South Africa will be acquiring other key arivia.kom customer accounts including Airports Company SA, the State IT Agency (SITA) and the Department of Water and Environmental Affairs.