SIKI MGABADELI: Sphere Holdings and BBD have announced Sphere’s acquisition of an additional 14.2% of BBD. It’s a 32-year-old R500 million/year custom software developer. The cash deal will see Sphere’s ownership stake rise to 49.9%, which, together with the 1.1% held by the Student Sponsorship Programme, makes BBD 51% black-owned.
So let’s hear from the chief executive of Sphere, Itumeleng Kgaboesele. Itumeleng, thanks for your time this evening. Take us through the rationale for this transaction.
ITUMELENG KGABOESELE: Good evening, Siki. We’ve been invested in BBD since 2008 and during the period of our investment we’ve seen the business grow and more than double to employ just over 5 550 software developers.
This is a business that we are extremely excited about. When the two of us last spoke one of our stated strategic initiatives was to increase our exposure to businesses that had done well for us. So, together with our fellow shareholders and management team at BBD, we took the collective decision that BBD could be repositioned differently in the market by being a black-controlled business. Hence this transaction that we announced today.
SIKI MGABADELI: I understand that BBD’s own founders and management will retain a certain percentage of ownership as well. What do you think is the benefit of that for the business?
ITUMELENG KGABOESELE: BBD has really built a great track record over the last 32 years in delivering mission-critical solutions to clients and financial services and the public sector. So our transaction really is a reconfirmation of our commitment to the team. It signals our belief in the senior executive team at BBD and in fact in every single software developer at that organisation. So we continue to believe in the management team, we continue to believe in the staff of BBD.
This transaction that we announced really deepens the partnership that we have with them. It is not intended to change stuff that has been working, but it’s really meant to take the partnership to another level and grow the business as a team.
SIKI MGABADELI: We’ll leave it there. Thanks for your time this evening, Itumeleng Kgaboesele.