Private equity business RMB Corvest has partnered with Umoya Capital Partners and Calibre Capital to obtain a minority share in original-equipment manufacturer M4A, which has capabilities in extrusion, injection and compression moulding, precast concrete, glass-reinforced concrete and compression moulded composites products.
M4A specialises in the manufacture of passive network infrastructure for use in the formation of fibre networks and bulk civil infrastructure.
Items include small boundary boxes to large manholes to suit network distribution and various ducts which are eminently suitable for the telecommunications networks industry along with pre-cast and pre-fabricated municipal and civil engineering solutions.
“The business holds a strong customer base throughout Africa and Europe and is currently expanding into the US and Asia, with good growth prospects,” says RMB Corvest executive Geoff Wilmot.
M4A was founded in 1997 and has been part of the Civilworks Group since 2014. Civilworks, founded in 2006, is a supplier to the civil and municipal markets in sub-Saharan Africa.
The business’s manufacturing facility is based in Johannesburg and it has distribution facilities in both Durban and Cape Town, currently employing about 200 staff.
Supplying “right-fit architecture” for cost saving network design, along with the ability to deliver unique solutions to clients with specific combinations of material designs, is posited to place it in a unique position within the market.
“This transaction further expands the black economic empowerment status of M4A, which, in light of the South African infrastructure spend, ensures the competitive edge for the business,” says Umoya Capital partner Darryl Horney.
The business is said to have a robust, experienced management team, who constantly seek to enhance and fine-tune products and offerings.
“We currently hold eight patents on our original, unique designs. We continue to ensure our technical expertise is focussed on solving any challenges our clients face. Our strong manufacturing base coupled with new opportunities in the electrical sector, means our new private equity partners are invaluable. Both in terms of business strategy expertise, along with the long-term possibility of further consolidation in our sector,” says M4A MD Garreth Crooks.
The outlook for the business in the telecommunications sector is also noted to be positive. There is an expectation of good expansion globally owing to the improved build-to-cost ratio of networks.
Moreover, the local energy challenges that South Africa currently experiences mean that suppliers will need equipment to mitigate current or heavier rolling blackouts. This may prove to be another area of growth for the business.
M4A’s end-users were originally fibre network owners and mobile network operators locally and globally, including well-known South African brands.
However, M4A’s customer profile changed to include any intermediaries who were directed by these customers that had selected M4A as approved technical suppliers.
“M4A’s commitment to quality is highlighted by ISO registration. It remains our intention to continue to leverage partnerships with leading international suppliers to fuel organic growth. We are confident that this partnership will add impetus and significant value both to the business and its long-term market strategy,” says Wilmot.