Datatec is bringing in Common Atlantic – a significant international development fairness agency – as a minority investor and lender in Westcon-Comstor, its networking and cybersecurity distribution arm.
The deal values Westcon at US$950-million (roughly R15.5-billion) and generates about $434-million (R7.1-billion) in money for Datatec, which it intends to pay out as a particular dividend to shareholders.
Datatec introduced on Friday that it had signed binding agreements with Common Atlantic for the recapitalisation of Westcon. The transaction is anticipated to shut on 14 July 2026.
The deal has two primary elements. Common Atlantic will present a brand new six-year, $375-million senior secured debt facility at 9%/annum, partially refinancing an current intercompany shareholder mortgage of $450-million. Individually, it can pay $25-million in money for a 5% fairness stake in Westcon and can obtain warrant shares structured to copy the financial impact of 4% penny warrants and eight% at-the-money warrants – giving it an extra share in Westcon’s fairness worth accretion above $540-million.
Collectively, full reimbursement of the intercompany shareholder mortgage – funded by the $375-million Common Atlantic facility and $75-million from Westcon’s current financing services – plus the $25-million fairness co-investment will generate money proceeds to Datatec of about $434-million (R7.1-billion). The corporate says it intends to distribute these proceeds to shareholders by the use of a particular dividend. The precise quantum, file date and fee date might be introduced individually.
Worth unlock
The transaction values Westcon at $950-million earlier than reimbursement of the shareholder mortgage and $500-million after. On day one after closing, Datatec, via its Westcon Worldwide subsidiary, will maintain an 89.2% financial curiosity in Westcon, down from 95%, with Common Atlantic holding 8.7% and Westcon administration 2.1%.
Westcon-Comstor, which Datatec has owned since 1997, is a worldwide distributor and supplier of communications, networking, cybersecurity and cloud infrastructure working in additional than 50 nations. The enterprise reported web belongings of $127.7-million and revenue after tax of $66.8-million for the monetary 12 months ended 28 February 2026, and has delivered a compound annual Ebitda development charge of 24% over the previous seven years.
Datatec CEO Jens Montanana stated the construction “preserves and accelerates the profitable Westcon-Comstor system” whereas bringing in a companion with the capital and community to assist additional enlargement. “Datatec, with 40 years of expertise on this trade, will retain management whereas partnering with Common Atlantic, one of many world’s main suppliers of capital, as each a minority investor and lender to the enterprise,” he stated.
Leo Wouters, MD at Common Atlantic, stated the agency was “delighted to companion with Jens and the Westcon-Comstor workforce in pursuit of the corporate’s subsequent section of development”, including that Common Atlantic’s capital and strategic assist may “assist to unlock compelling alternatives as Westcon-Comstor continues to construct out its product portfolio and worldwide presence”.
The proceeds would mark one other in a collection of payouts Montanana has engineered as he works to shut what he has lengthy argued is Datatec’s power undervaluation relative to its worldwide friends. In 2017, the group returned as much as $500-million – then about R6.5-billion – to shareholders after promoting its Westcon-Comstor Americas operation to Synnex. In 2021, it paid a particular dividend of about $70-million after Westcon repaid intercompany loans – the identical mechanism now being deployed on a far bigger scale. And in 2022, Datatec distributed £135.1-million – R2.7-billion, or R12.50/share – from the roughly £140-million sale of its controlling 70% stake in telecoms consultancy Analysys Mason.
Learn: AI, cybersecurity energy standout 12 months for Datatec
Datatec’s shares had been buying and selling 3.3% greater in Johannesburg shortly after 12pm on Friday. Previously 12 months, the shares have climbed by a 3rd. – © 2026 NewsCentral Media
