ARC buys 20% stake in Rain

Ex­cep­tional re­turns on eq­uity

The Star Early Edition - - NEWS - Ziyanda Mbolekwa

AFRICAN RAIN­BOW Cap­i­tal (ARC), a South African fi­nan­cial-ser­vices firm started by Pa­trice Mot­sepe, on Fri­day an­nounced that it had in­vested 20 per­cent of fixed and mo­bile data net­work oper­a­tor, Rain.

This as ARC gears up to list on the JSE later this year in an ini­tial pub­lic of­fer­ing of its in­vest­ment-hold­ing unit said to be roughly R3 bil­lion, ac­cord­ing to news re­ports.

Jo­han van Zyl, ARC’s co-chief ex­ec­u­tive, said: “We fo­cus on South African and African busi­nesses that de­liver ex­cep­tional re­turns on eq­uity, and it is ex­cit­ing to in­vest in a com­pany that is at the start of its growth tra­jec­tory.”

“There is great de­mand in our coun­try for fast, re­li­able and af­ford­able data cover­age and Rain prom­ises to de­liver just that,” said Van Zyl.

Dun­can Simp­son-Craib, chief ex­ec­u­tive of Rain, for­merly Wire­less Busi­ness So­lu­tions, said: “The ad­di­tional eq­uity cap­i­tal raised from ARC, over and above the fund­ing al­ready in place, en­sures that we have the cap­i­tal to achieve our ag­gres­sive roll-out tar­gets over the next three years”.

Rain has re­cently en­tered into an agree­ment whereby In­ter­net So­lu­tions and its part­ners would pro­vide clients with wire­less broad­band ser­vices pow­ered by the Rain net­work.

The LTE Ad­vanced net­work, re­ferred to as “fi­bre-in-thesky’” was ideally po­si­tioned to be a pi­o­neer in the fu­ture roll­outs of 5G net­works, ac­cord­ing to the com­pany. Simp­son-Craib said: “Our deal with the ARC, plus its ex­ist­ing fund­ing, al­ready se­cured, al­lows Rain to roll out our 4G+ net­work across South Africa.”

“Our in­ten­tion is to build a next gen­er­a­tion net­work and a next gen­er­a­tion busi­ness and pro­vide af­ford­able and re­li­able con­nec­tiv­ity for all,” he said.

Rain has rolled out more than 1 000 sites and 1 500 base sta­tions. It was on track to meet its tar­get of 2 000 sites by the end of the year, he said.

Big­ger net­works

Rain com­petes with mo­bile net­works Vo­da­com and MTN. Ac­cord­ing to Tech Cen­tral, Rain re­cently signed a co-op­er­a­tion agree­ment with Vo­da­com, which may be plan­ning to of­fer LTE-A (also known as 4G+) ser­vices on the back of the Rain net­work. Vo­da­com and other oper­a­tors had not been able to de­ploy wide­spread 4G+ in­fra­struc­ture, be­cause they had not been granted ac­cess to new spec­trum re­sources, it said.

Simp­son-Craib said Rain aimed to con­nect South Africans to the “lim­it­less pos­si­bil­i­ties of the dig­i­tal world”. Data prices in South Africa were high and this was of­ten a re­sult of the cost of in­fra­struc­ture to roll-out a net­work, he said.

Paul Har­ris, the chair­per­son of Rain, said the part­ner­ship would also en­hance Rain’s al­ready sig­nif­i­cant black eco­nomic em­pow­er­ment own­er­ship cre­den­tials.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.