Diversified and niche telecommunications, retail, distribution and technology services company, DN Invest has concluded an empowerment transaction with Mineworkers Investment Company, an established and highly regarded BBBEE investment holding company.
The transaction involved MIC Investment Holdings acquiring 25.1% of DNI’s shares in a transaction valued at approximately R760 million and was concluded on 1 April 2020 following the sale and buy back of NET1’s remaining 27.5% interest in DNI.
Commitment to transformation
Says Andrew Dunn, CEO of DNI “We ran a process to raise equity for the Group and in that regard, tapped into our existing shareholder network. We realised that MIC would be the ideal partner for our business given their excellent track record as value adding shareholders. We therefore could not be more excited to have successfully closed the sale of the available stake to MIC as in addition to the wealth of experience they bring as active shareholders, they also provide broad-based black ownership credentials and support. This is hugely positive for DNI going forward given our growth objectives and commitment to transformation within South Africa.”
DNI is a leading distributor of pre-paid airtime, mobile subscriber starter packs and sim cards, as well as handsets to emerging consumers in South Africa. The company also owns a significant interest in a range of digital technology platforms which include micro-jobbing, training, airtime advance, SMS aggregation and service delivery platforms in the mobile space. The company has performed robustly in the challenging economic climate and is well-positioned for growth through and beyond the COVID-19 pandemic.
“MIC’s acquisition of DNI demonstrates our confidence in the company, its seasoned management team and the prospects of the telecommunications sector,” notes Mary Bomela, MIC CEO. “Even prior to the blow that COVID19 has dealt to the economy, trading conditions were difficult for several years in South Africa and finding assets that have continued to grow and generate dividends in this environment is tough. DNI is a market leader and offers MIC both growth and dividend flow – key to sustaining MIC’s dividends to its shareholder trust that fund a range of educational and developmental programmes.”
Dunn also comments “DNI is serious about improving its BEE level and standing and has embarked on a broader transformation journey in this respect. MIC will be an important partner in guiding us, given its long history and experience in the BEE investing space.”
Bomela concludes: “We completed the transaction during the Level 5 lockdown in late March, with this being one of MIC’s largest investments to date. Economic recovery will take some time in South Africa – but there are still good assets out there, and we continue to invest.”