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Nairobi - IT company Altech will invest heavily in east Africa, which it sees growing to account for more than a third of its profits from 10% now, its chief executive said on Wednesday.
Through a holding firm, Altech bought a 51% stake in two Kenyan and one Ugandan technology companies for $80m in March this year. It also has interests in Rwanda.
"We ourselves are pouring in a lot of money," chief executive Craig Venter told Reuters in an interview.
"The profitability of this investment is about 10 percent of Altech's overall profitability, but I see that contribution growing to maybe 30% to 40% over the next three to five years or so."
Despite a bloody post-election crisis that hurt its economic growth forecast, Kenya has rebounded since a power-sharing deal and many investors see it as one of Africa's best prospects thanks to its strategic location and diversified economy.
The JSE-listed firm earlier this year invested in Infocom Uganda, Kenya's SwiftGlobal and Kenya Data Networks (KDN), which carries 70% of incoming and outgoing data traffic in Kenya.
To achieve its growth target, Venter said, Altech would invest in infrastructure. Through KDN, it has a 10% stake in a Kenyan government project to build a 5 000km cable linking the port of Mombasa with United Arab Emirates.
It is due for completion in the second half of 2009.
The government hopes that will cut telecoms costs and launch a call centre outsourcing industry. Kenya currently relies on satellite bandwidth, which is more expensive and less available.
Altech, which also has interests in mobile phone providers, vehicle tracking firms and other IT companies, has been seeking acquisitions to expand its core telecoms and IT business.
- Reuters