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IQ ANNOUNCES NEW BEE SHAREHOLDING
IQ explodes back onto SA business scene with new shareholding January 2006 - A decision taken some months’ ago by The IQ Business Group’s senior management team to buy-out former owners Nedbank, Investec and HCI was the catalyst that today sees IQ’s official re-emergence as a newly energised R300-million turnover business with 500-plus employees worldwide – and the announcement of a new ‘e-deal’ partnership. 
The new broad-based ‘e’-transaction (where ‘e’ = empowerment, energy and entrepreneurship) comprises Peotona Development, the non-profit development arm of Peotona whose founders are Cheryl Carolus, Wendy Lucas-Bull, Dolly Mokgatle and Thandi Orleyn; and Phatsima Technologies’ Herman Mashaba, founder of Black Like Me beauty products. A defining component of the private business transaction is that it unusually incorporates an international footprint that currently spans IQ’s operations on four continents – Africa, North America, Australasia and Europe. The BEE deal sees an approximate one third equal ownership split between black economic empowerment partners, Peotona Development, Phatsima Technologies, IQ’s HDSA (Historically Disadvantaged South Africans) Management Trust, senior IQ management and private equity investors including JSE-listed Peregrine. The transaction provides IQ with a 31.2% black shareholding comprising Phatsima Technologies 11.2%; Peotona Development 10% and HDSA Management Trust 10%. The new board comprises of three executive directors Dirk Ackerman (CEO), Pieter Van Tonder (CFO), Chris Sinclair (Executive) and four non-executive directors Cheryl Carolus – who will also take the chair, Wendy Lucas-Bull, Herman Mashaba and Sean Melnick, with Dolly Mokgatle as alternate. “IQ’s former owners were committed to ensuring that – as an integral part of the management buy-out – the sale of their equity would be an enabling move to increase empowerment participation in the IT sector. We are therefore delighted to be joined by partners of such proven substance,” said IQ CEO Dirk Ackerman. “All possess outstanding business acumen in their own right. Their involvement will be a tremendous asset in not only entrenching IQ as a vibrantly energetic, can-do company with a social conscience that continues to attract highly talented individuals, but also – through their extensive professional networks worldwide, assist in IQ’s expansion plans.” Whilst the former high-profile company may appear to have gone underground, it has nevertheless continued to be a hive of internal growth and activity. IQ has taken stock of current operations, whilst continuing to forge an enviable reputation in its specialised field of providing practical technology-driven business solutions. Its US operation has enjoyed a 185% growth in business in the past 18 months. The Australian operation has been dramatically strengthened by impressive organic growth and the acquisition of highly-respected IBM partner, K1 Pacific, together with the strategic acquisition of the 50% stake held by Mellon Bank in IQ Australia’s financial business services with it now becoming a wholly-owned subsidiary of IQ. At the same time, the South African business has secured a number of prestigious private and public sector contracts, prime examples of which include the SA Revenue Service and, most recently, the Bond Exchange of SA. However, underpinning all this activity has been the committed search devoted to finding the right empowerment partners. There was a firm desire by management that The IQ Business Group become truly representative moving forward. To do this, it needed to reflect the philosophy of socially responsible business practice guided by individuals committed to ensuring that the company maximises its contribution to the transformation and capacity-building of the SA economy. It was this very philosophy that attracted IQ’s new partners and that, in turn, put them ahead of the many others that had expressed interest in becoming part of this innovative deal. The objective of Peotona Development is to facilitate the empowerment of previously disadvantaged groups and individuals with special focus on women, rural communities and people with disabilities. The non-profit entity is working to facilitate this development through the creation of ‘smart partnerships’ between business, donors, commercial funders and local government, NGO’s and communities. Executive Chair, Cheryl Carolus, says: “IQ brings enormous expertise and people resources to the table; we have the strong networks and established credibility to knit together the various entities and engage with communities to create the ‘smart partnerships’ needed to actually make things happen.” “Peotona Development and IQ’s aspirations have great synergies. We both have a commitment to development and fully appreciate the critical need to provide sustainable opportunities to economically marginalised people. Peotona, as a non-profit organisation, gains not only longer term funding flow from the deal to support its development work but also access to skilled business resources to assist with its objectives.” It is this passion to doing business in a socially responsible way, that finally set the seal on this e-deal and that also caught the fancy of Phatsima’s Herman Mashaba, one of South Africa’s most dynamic young businessmen. “I’m excited by the opportunity to invest in the information technology services industry through The IQ Business Group. The current size of the business presents massive growth potential for us as investors here in SA and internationally. The business has the right caliber of leadership to steer and position it as a world-class SA IT services company.” “Today marks the end of our beginning,” concludes Ackerman. “We have sown the seeds of future growth. Through the pooling of our not inconsiderable joint expertise, we fully intend to deliver a harvest that will reap rewards far beyond that of paying mere lip service to the maxim - ‘making a difference’.
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