Telkom has formally appointed advisors to drive the process to seek a strategic equity partner for BCX, its limping IT business that has been losing money for a few years now.
BCX was founded by Benjamin and Isaac Mophatlane in 1996, and was later acquired by Telkom in 2015, in a deal worth R2.6 billion.
Telkom announced on Tuesday that BCX had a challenging year but managed to maintain stable revenue levels at R14.2 billion in the year to end-March 2023.
The company said the performance was driven by a 9.1% growth in the IT business, which was offset by declines in the Converged Communications business.
“The IT business growth was largely due to double digit revenue growth in the hardware and software business, albeit at lower margins.
“The Converged Communications business continued to be impacted by migration to next-generation technologies and robust competition in the market.”
Telkom added that BCX is bolstering its skills and capabilities to support and guide its customers in transitioning to cloud-based solutions and adopting new business models requiring modern ICT solutions.
Telkom also announced that its management has been investigating the possible introduction of a strategic equity partner at BCX to enhance scale, growth and its capabilities in various growth areas including cloud services and cybersecurity.
“A process is currently underway to assess the market for potential international and/or local partners and to consider available options in this regard,” said Telkom.
The company added that it has formally appointed advisors to drive this process.
“Further updates will be made to the market as and when considered necessary,” said Telkom.
