Teraco Data Environments (PTY) Ltd, Africa’s leading provider of vendor neutral data centre services, and Permira, the international private equity firm, today announced an agreement to acquire 100% of the equity in Teraco in partnership with management. This transaction marks the Permira funds’ first investment in Africa.

After being co-founded in 2008 by Tim Parsonson and Lex van Wyk, Teraco became a dominant player in Africa’s data centre evolution. The past six years has been a significant period as the start-up grew to become a significant nationwide business. With three well-established data centres across all major metropolitan areas, Teraco is now the leading provider of reliable and resilient infrastructure across sub-Saharan Africa.

Lex Van Wyk, CEO, Teraco, said: “The management team is excited to welcome the Permira funds as a shareholder and we are optimistic about the opportunities provided by this new partnership moving forward. Timing is key in these situations. Teraco is now a mature business with a proven strategy, and the Permira funds’ experience in investing in technology markets globally will help Teraco deliver its ambitious growth goals.”

Teraco completed several expansions of its Johannesburg and Cape Town facilities during 2014 and 2015 will see significant further expansions to Johannesburg. Currently Teraco provides 6500 sqm of white space, of which only 2000 remains available. 2015 will see the Johannesburg data centre expanding to provide additional much needed facilities for sub-Saharan Africa.

Teraco is also the only data centre with access to all undersea cables and the most African fibre networks. Through NAPAfrica, Teraco’s open peering and Africa’s biggest Internet Exchange, Teraco houses five of the largest global content players. More than 120 members share content across the continent via NAPAfrica, making Teraco the most connected, neutral environment in Africa.

In Teraco, the Permira funds are backing a leader in a market with strong fundamental growth drivers. Teraco has built an important strategic position to capture the regional opportunity as a trusted and secure partner with reliable power sources. The Permira funds investment will support the company’s growth plans and its expansion into Sub-Saharan Africa.

Michail Zekkos, Principal at Permira, added: “As the leading vendor neutral data centre provider, Teraco is ideally positioned to continue serving the most critical IT infrastructure components of its clients, powering their interconnection and connectivity needs. We look forward to partnering with Jan Hnizdo and Lex van Wyk and their great management team to support the next phase of growth.”

Van Wyk concludes: “Teraco remains focussed on neutrality and will continue to support its clients, by growing communities and ensuring the data centre environment is taken care of by a team focussing on doing just that.”

The transaction is subject to regulatory approval and customary closing conditions, and is expected to complete in Q1 2015

Quayle Munro served as the financial advisor to the Teraco shareholders and Bowman Gilfillan served as their legal advisor.