[Johannesburg, SOUTH AFRICA] Convergent banking and IT group Nedcor announced on
Monday that it has taken a 74.9% stake in Indian IT firm, Nihilent Technologies in
exchange for a $10 million (R70 million) investment.
The Mumbai-based start-up was established by Indian IT ‘personality’ LC Singh,
focusing on e-business software development and IT consultancy.
The company will remain based in India, in order to capitalize on the skilled
and inexpensive programming workforce of the region, but plans to extend
operations to South Africa, Australia, the U.K. and the U.S.
Singh, who called this deal the “single largest investment by a South
African company in an Indian IT company”, has had a five year working
relationship with the banking group which laid the foundation for this deal.
He revealed that the company will provide e-commerce solutions to all
industries, not merely the banking sector, and might pursue a listing at a
later stage.
Nedcor CE Richard Laubscher believes that this investment is a well-placed strategic
move considering India’s dominance in software development and Singh’s status in the
Indian IT community, virtually guaranteeing a positive market reception for the new
company.
Laubscher revealed that Nihilent’s technologies will be immediately harnessed for the
expansion of Nedcor’s e-commerce and internet strategies.
The transaction is still subject to regulatory approval, but Nedcor revealed last week
that the company will be pursuing a series of IT investments in the coming months.
The company will further elaborate on their IT strategy at a media presentation at the
end of this month.
Executive Director Tony Routledge did reveal, however, that further Nedcor
investments in South African IT companies are likely to be announced before the end
of the month.
