Who wins in data deal?
TIMES Media Group (TMG), which owns this newspaper, announced last month it would sell financial data unit I-Net Bridge to McGregor BFA for R115-million.
The sale is yet to pass through the Competition Commission for approval, but it is a significant deal between competitors in the local business data market — McGregor BFA is part of Media24, which falls under the Naspers group. Who got the better deal? In an announcement to customers this week, I-Net Bridge MD Anina Morley said changing market conditions required a different approach.
Morley said TMG was restructuring to focus on its core businesses. In the light of the increased level of investment required to compete locally, it decided Naspers was better positioned to grow I-Net Bridge in competition with global financial data businesses.
Naspers spokesman Meloy Horn said McGregor, currently a relatively small market player, aims to increase its market share through acquisition rather than organic growth.
Horn also said the merged entity would form a unique African financial information database unparalleled in historical depth and that would become an attractive offering to investors in developing markets.
Andrew Gill, deputy MD at TMG, said: “It’s a good business, but it needed to be given the money to compete, so we decided to sell it now to give it a chance. Also, if we sold to overseas interests, there was a good chance of jobs being cut.”
These sentiments were echoed by Andrew Bonamour, CEO at TMG, who said the investment required for I-Net to compete against foreign data agencies and comprehensive platforms that have moved into the market was out of reach for TMG.
Was that a good move? Abdul Davids, head of research at Kagiso Asset Management, said this could be a rare win-win deal. “I think it suits both parties.
“I-Net didn’t have a lot of fit with TMG and required big capital spend.”