[Johannesburg, SOUTH AFRICA] Networking integration group Dimension Data told
reporters on Wednesday that it expects its US operations to generate between 30 to
40-percent of its total revenues by the end of 2003.
Speaking in an interview, Didata Finance Director Malcolm Rutherford revealed that
the group is looking to expand prodigiously in the North American region through a
targeted acquisitions policy, more than doubling its current 14 percent of revenues garnered
from activities in the region.
“Two years out, 30 to 40 percent of our business will come out of the U.S., if not more,”
Rutherford commented, highlighting the central and western regions of the U.S. as
particular reservoirs of profitability yet to be fully exploited by his company.
Rutherford revealed that there are two primary reasons for a push into the U.S. market,
the most obvious one being the scope for growth within the largest IT and networking
market in the world.
A secondary strategic reason is a possible Nasdaq listing for Didata, already listed on
the Johannesburg and London Stock Exchanges.
The Nasdaq listing is an intriguing possibility.
Initially mooted as the company preferred to list in London and become a “large fish in
a smaller pond,” Rutherford suggested yesterday that a listing on the U.S. technology
exchange could become a reality before the end of 2001.
“If you are serious in this world, the majority of your earnings should come out of the
U.S. and if you’re serious about keeping staff it helps to have a Nasdaq listing,” he
commented.
Rutherford indicated that acquisitions would presage the path to Nasdaq, but that any
such listing would take place within the timeframe Didata had set itself to establish
first-mover advantage in the region, that is within 8 to 14 months.
The group is already moving at a breakneck speed using the GBS1,4-billion gained
from its June LSE listing for minority buyouts and specific acquisitions in the U.S.,
Europe and Scandinavia.
On Tuesday, the company announced a partnership with the Nasdaq listed Internet
Security Systems (ISS), an alliance which simultaneously vaulted ISS to the top of the
list of managed internet security companies and also provided Didata with
much-needed regional credibility.
“If we are going to become a global player, the bulk of our revenues have to come out
of the United States,” Rutherford remarked, revealing that South African business
accounts for 39 percent of Didata’s revenues, more than double the percentage gained from
its U.S. operations.
With South Africa accounting for a mere 1 percent of the global networking market
as opposed to the U.S.’s 50-percent, Didata’s desire to expand it’s U.S. revenue base
would indicate a reversal of its ‘large fish, small pond’ strategy.
