CMC Networks, Africa’s largest managed connectivity provider, today announced that The Carlyle Group, a Global Alternative Asset Manager, has acquired a majority shareholding of CMC. The transaction value exceeds $100 million (R1.4 billion) and Carlyle’s investment gives them a majority shareholding. Further financial details of the transaction were not disclosed.
Founded in 1989, CMC has the largest managed connectivity network in Africa, with a comprehensive office footprint spanning some 70 countries in Africa and the Middle East, and plans to further extend into Asia and South America. Through its unique ability to provide services in operationally challenging regions of Africa and the Middle East, while providing world class reliability and latency standards, CMC serves over 50 global telecommunications carriers, including 12 out of 14 of the largest ones.
These carriers use CMC to provide fast, reliable data and internet connections to global enterprises operating in Africa and the Middle East.
Grant Walker, founder and CEO of CMC, said: “Over the last 28 years, CMC has grown its network organically, and has responded to this region’s increasing appetite for reliable and secure data and internet connectivity. CMC’s research has shown that Africa’s demand for high quality bandwidth is growing by some 30% p.a. CMC has cultivated a blue-chip customer base driving international traffic into Africa but is also presently experiencing a growing amount of traffic leaving Africa from African customers. This investment by Carlyle will accelerate CMC’s growth through greater investments into new partnerships and acquisitions.”
Martin Springer MD of CMC said, "CMC has quadrupled its revenue in the last five years and at present we have in excess of 100 POPs, 2000 circuits, and, through our carrier customers, we currently manage high quality data and internet connections to over 400 enterprises, including over half the Fortune 500. We have an extensive geographic footprint, which enables us to serve multi-geography and multi-site customers. We believe this investment from Carlyle is opportune as it allows us to rapidly pursue new markets, products and avenues for growth.”
Braam Verster, a Director of Carlyle’s Sub-Saharan Africa Fund said: “We are excited about our partnership with CMC and its talented management team. We believe the fast growing data demand in Africa and the Middle East offers tremendous growth opportunities for CMC, and we look forward to using our sector expertise and global network to help them achieve their goals” Equity for the transaction came from the Carlyle Sub-Saharan Africa Fund.
This is the seventh investment by Carlyle’s dedicated Sub-Saharan Africa fund. Financing was provided by Standard Bank of South Africa and Rand Marchant Bank.