Dual-listed Datatec has finally succeeded in buying PC distributor Comztek, although for a lower amount than what it offered two years ago, as it will pay up to R88 million to buy the pan-African company.

The merger between Datatec’s Westcon unit and Comztek, which is partially owned by JSE-listed Mustek, will create SA’s largest value-added distributor with revenue of more than R2.6 billion.

About two years ago, a previous bid by London- and Johannesburg-listed Datatec to buy Comztek, for R101 million, fell through. At the time, Mustek was not keen to sell its share, wanting rather to up its almost 42% share, and Datatec said it would not pursue the buyout any further.

Mustek’s sale is part of its ongoing drive to reduce debt by disposing of non-core assets. CEO and founder David Kan says Mustek, which did not have a controlling stake, had tried to buy out other shareholders, but failed.

Mustek acquired the Comztek stake when it helped management purchase the company in 1999. Comztek was established in September 1999, but was initially formed in 1995 as Comzlink, a subsidiary of Centera, which was owned by Siltek and Q Data.

Four years after it was initially formed, Leen van der Bijl and current Comztek MD Paul Conradie bought out the distributor with Mustek's assistance.

Across Africa

Datatec CEO Jens Montanana says the deal is “an exciting opportunity to create a market leadership position across the continent which will extend and augment our existing emerging Africa and South African operations and bring a strong business with an excellent reputation into the group”.

The combined business will have revenue across Africa of more than $300 million, around R2.6 billion, says Montanana. Datatec will buy Comztek from its current shareholders, which includes Mustek and various members of the management team through family and employee trusts.

“Africa remains a key growth market for us and this deal significantly expands our footprint and offering into many new markets. As the continent continues to develop, our solutions and services will play an important part in the rapid adoption of more advanced IT and telecoms infrastructure.”

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