The Japanese telecommunications service provider, Nippon Telegraph and Telephone (NTT) reached an agreement with Dimension Data on the terms of a cash offer for the entire issued and to be issued ordinary share capital of the company.
The acquisition is subject to various regulatory and governmental approvals and is due to be completed in October.
Dimension Data local chief, Steve Nola, assured it would be business as usual for the company and its subsidiaries, Express Data and Dimension Data Learning Solutions.
“This announcement is about growth rather than cost cutting and there are no planned operational changes,” Nola said in a statement.
“All Dimension Data staff have been briefed. Client and partner briefings are now underway.”
Nola said NTT was a complementary, strategic alliance for Dimension Data with virtually no overlap. It will continue to operate as a completely independent business, reporting into the highest levels of NTT, he said.
“Dimension Data and NTT have an aligned vision for how the market will evolve and the opportunities that await us with our combined capabilities are very exciting,” Nola said.
NTT CEO, Satoshi Miura, said in statement the company was confident it could provide end-to-end, global one-stop and high quality ICT services.
“Dimension Data and NTT share the common vision to create new services and values to succeed in the coming age of cloud computing,” Miura said. “Our combined strength will allow us to accelerate the execution of our strategies to achieve our shared vision.
“We have established a strong relationship between the management of Dimension Data and NTT. We are looking forward to welcoming the management and employees of Dimension Data to the enlarged NTT group.”
Dimension Data executive chairman, Jeremy Ord, said NTT’s network carrier capabilities and assets coupled with its own global system integrator expertise, was a powerful combination of capabilities and skills.
“The combined companies will hold a strong competitive position serving global corporations’ moving to managed infrastructure services and cloud computing,” Ord said.
In a blog, EMC global vice-president of marketing, Chuck Hollis, said he sees the importance of this acquisition as an early sign in the restructuring of the IT industry. Hollis has previously worked for both NTT and DiData.
“What could cause two ostensibly successful companies to join forces?” Hollis said in his blog. “Simply put - cloud changes everything.”
“Part of this re-making of the IT industry will be around the creation of entirely new value chains that deliver the technology to the consumer. And one way of interpreting the NTT / DiData combination is clear: this is emblematic of the new face of how IT services will get to market going forward.”
Hollis said there would undoubtedly be more acquisitions like this in the future.
“Will we see more acquisitions like this going forward? Where a large and proficient telco-style service provider acquires a system integrator with customer-facing skills? Undoubtedly. I've even got a private list of who I think is going to want to buy who.”