Didata better ‘ placed to grow ’
As technology firm Dimension Data completes its reorganising and rebranding to operate under one name, CEO Grant Bodley told Business Day in an interview that the company is now much better placed to grow its business.
As technology firm Dimension Data completes its reorganising and rebranding to operate under one name, CEO Grant Bodley says the company is now much better placed to grow its business and have a more productive relationship with its clients.
In an interview, Bodley said the plan to retire its Britehouse, Internet Solutions and ContinuitySA brands in a move that has resulted in the group operating under one name and reducing duplication between some of its subsidiaries, had been completed in August for the SA market.
In some countries, the legacy brands would remain a little longer as the company adheres to local regulations.
The brands have now been retired with the exception of internet service provider MWeb and business process outsourcing unit Merchants, said Bodley. He said those two units did not
“
fit into the new One Dimension
” “
Data structure and would
” continue to operate unchanged, for now.
Dimension Data s effort to
’
simplify its business follows a trend in the industry which has seen firms such as Altron consolidate its businesses under its own One Altron strategy. At
“”
EOH the story is similar.
Before Stephen van Coller and his team came in, EOH was made up of 268 entities and operations, which it is working to consolidate and bring under three business units: iOCO, Nextec and IP.
The reorganising of Dimension Data has not been without its sacrifices. Bodley said they had had to let go of about 490 people during the process, leav
ing the group s headcount at ’
“closer to 11,000 ”.
The company was once considered one of the largest technology companies on the JSE, with market capitalisation of R77bn at its peak in September
2000. It delisted from the exchange in 2010, after being bought by Japanese technology firm Nippon Telegraph & Telephone (NTT) for £2.1bn. Dimension Data remains an independently branded affiliate of the
NTT Group — valued at $80bn (R1.3-trillion) and retains the
—
Dimension Data brand.
Asked whether the company would list on the JSE now that the reorganisation was done, Bodley did not dismiss the idea, simply saying the company had “no immediate plans to do so.
”
But even if the group is considering a listing, Peter Takaendesa, head of equities at Mergence Investment Managers, said “going public is always an effective and quicker way for private equity investors to realise value, provided they are floating attractive and large assets that can achieve good liquidity on the public stock exchange ”.
However, Takaendesa said, “valuations for most SA stocks are quite low at themoment due to economic concerns and we therefore think it will be very difficult to achieve listing valuation multiples similar to what NTT paid for DiData when they took it private years ago ”.
It may well be better for Dimension Data to consider a listing in Europe or the US where there are greater pools of capital and appetite for such companies. An example is Altron s plan to list its Bytes UK
’
unit in London as a way to realise a higher value for the business
Dimension Data continues to invest heavily in the local market, having recently announced the first phase of construction for its Johannesburg 1 Data Centre. The first phase is scheduled to start operating at the beginning of 2022.
The new data centre is being built together with parent company NTT, which is the thirdlargest data centre provider in the world according to analytics firm Intricately. The new project will add to the Japanese company s more than 160 data cen
’
tres across 20 countries.
In addition to local demand for storage and computing power, Bodley said Dimension Data had seen increased demand particularly in West and East Africa for its data centres, anticipating that this will grow even more as organisations adopt cloud services. The group operates 11 such centres across Africa.
I m very pleased with our
“’
performance,” Bodley said about Dimension Data s perfor
’
mance in the first half of its financial year. Like other ICT businesses, the company has seen increased demand for software and communications tools as people work and learn more from home.
Given the huge economic contraction seen in the second quarter of 2020, Bodley is under no illusion about the effects of Covid-19 on their business. Parts of our business have
“
thrived,” he says, explaining that though they ve seen good
’
growth in certain units, clients in industries badly hit by the pandemic such as tourism weighed on Dimension Data s overall
’
performance. However, Bodley is hopeful that as the economic activity picks up, large projects
—
those costing R100m and more
would resume.
DIMENSION DATA HAD SEEN INCREASED DEMAND PARTICULARLY IN WEST AND EAST AFRICA FOR ITS DATA CENTRES