Altech in talks for $60m Kenya firm Symphony

Allied Technologies is in talks to pay up to $60-million for unlisted Kenyan IT firm Symphony, according to a person familiar with the matter, to help revive its struggling business in fast-growing East Africa.

Johannesburg-based Altech, a $742-million IT company, has been in talks to buy Symphony for several months and is now nearing the end of its due diligence, said the source, who declined to be identified because the information is not yet public.

Altech is likely to pay between $50-million to $60-million for Symphony, giving it a price-to-earnings ratio in the teens, said the source.

Buying Symphony—which has also has operations in Uganda, Rwanda, Burundi and Ethiopia—would augment Altech’s existing business in the region, where it has struggled.

Altech in September replaced the head of its underperforming Kenyan data unit and named a new team to lead its East African operation.

“The turnaround of our East African activities is clearly a top priority within the Group and is receiving considerable management attention,” the company said when it released its first-half earnings in September.

Symphony provides IT consulting and services including hardware, software and networking. Symphony is owned by the Da Gama Rose Group, led by prominent Kenyan businessman Horatius da Gama Rose.

Symphony’s business partners include IBM, Cisco Systems, Dell, General Electric Company, Microsoft and China’s Lenovo Group and Huawei Technologies, according to its website.

No one was immediately available for comment at Altech, nor was Da Gama Rose’s office.

South African firms are increasingly looking to do deals beyond their crowded home market to tap into the rising disposable incomes in poor but fast-growing regions such as East and West Africa.—Reuters