South Africa’s Competition Commission, the country’s business practice watchdog, has unconditionally approved the merger of ISPs: Afrihost, and Cool Ideas.
In June, Afrihost and Cool Ideas said they had concluded a deal in which Afrihost would purchase a majority stake in Cool Ideas. However, the new deal does not see Afrihost absorb Cool Ideas, instead, the companies plan to hold separate brands going into the merger. Cool Ideas is also reported to keep the same management and employees for the immediate future.
“The Commission found that the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets. The Commission further found that the proposed transaction does not raise any public interest concerns,” the organisation said.
According to Developing Telecoms, the majority stake in Cool Ideas will make Afrihost a significantly larger player in the South African fibre ISP market. Afrihost already owns a stake in Axxess, one of the country’s most important service providers.
Cool Ideas, founded in 2011 by Andre Jooste and Paul Butschi when the pair explored prospects for starting a hosting business, is currently ranked by Ookla as the provider of the fastest fixed broadband internet in South Africa. Afrihost is in second place of the same rankings, with Axxess at 5th place.
Afrihost offers a wide range of services to its customers, including retail supply of internet access services to residential and small businesses, voice over internet protocol services, data hosting services and ancillary services (eg, Web site design, internet marketing, internet domains), and mobile voice and data services (as a reseller).
This acquisition is set to create a powerhouse with three of South Africa’s top ISPs under the same umbrella.