Mo Ibrahim fund in Sh2bn buyout of Nairobi IT firm

Ison founder and chairman Ramesh Awtaney during the interview at the Hilton Hotel in Nairobi September 12, 2013. Photo/Salaton Njau 

By John Gachiri, jgachiri@ke.nationmedia.com

Posted  Thursday, September 12   2013 at  19:42

In Summary

• Satya Capital acquired a 25 per cent stake in Ison Growth Markets, the holding company that owns Spanco BPO Africa, in a deal valued at between $20 million and $30 million.
• Ison’s Nairobi office employs 250 staff out of 4,000 employees spread in Nigeria, Niger, Chad, Sierra Leone, Burkina Faso, Tanzania, Uganda, Rwanda and Madagascar.

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Satya Capital, a London-based investment firm that is associated with billionaire entrepreneur Mo Ibrahim, has bought into Spanco BPO Africa, a continental information technology firm that is headquartered in Nairobi.

Satya acquired a 25 per cent stake in Ison Growth Markets, the holding company that owns Spanco BPO Africa, in a deal valued at between $20 million (Sh1.75 billion) and $30 million (Sh2.63 billion).

The acquisition values Ison Growth Markets at between $80 million (Sh7 billion) and $120 million (Sh10.5 billion).

Ison’s Nairobi office employs 250 staff out of 4,000 employees spread in Nigeria, Niger, Chad, Sierra Leone, Burkina Faso, Tanzania, Uganda, Rwanda and Madagascar.

“The entire management will stay in place, only the ownership has changed,” the Ison founder and chairman Ramesh Awtaney told Business Daily in an interview.

Mr Awtaney said that non-disclosure agreements bar him from giving the exact transaction price.

The transaction saw the exit of one of the joint owners of Spanco BPO, Spanco India, to make way for Satya’s entry. Spanco BPO has now been rebranded to Ison BPO.

Mo Ibrahim is the founder of Celtel, which at some point owned Kenya’s second largest mobile telecommunications firm, now called Airtel. The company has a target of growing its Africa workforce to 40,000 within the next four years.

Mr Awtaney said growth of the firm has been largely driven by the increase in internet access in a continent that is underserved by poor infrastructure network.

Ison BPO has already signed a deal with Nakumatt, the largest retailer in the region, where the tech firm will build IT infrastructure that will allow shoppers to buy goods either through their smartphones or by phoning a call center.

Mr Awtaney says the online shopping proposal is hinged on giving shoppers an alternative to physically going to stores, which is not preferred when it involves getting stuck in traffic and navigating car parks in search of space.

Internet access in Kenya and most of Africa is mainly through mobile phones. The potential that more Kenyans will shop via their phones is already attracting other international investors.

Ringier, a Swiss-based media company, has invested in Kenya through Ringier Kenya Ltd which runs the rupu.co.ke, pigiame.co.ke, and rupushops.co.ke platforms.

“In future, Ringier intends to achieve growth not only through digital media but in new markets as well. That is why the Group now operates no fewer than 15 digital platforms in Kenya, Nigeria and Ghana.

These pilot initiatives are providing Ringier Africa with a valuable opportunity to explore the potential which the large African market represents,” says the Ringier’s 2012 annual report.