By Loni Prinsloo.
Vodacom Group will seek partners to build out artificial-intelligence data centres in Africa to share costs and add additional expertise, Chief Executive Officer Shameel Joosub said.
The Johannesburg-based company has already partnered with billionaire Strive Masiyiwa’s Cassava Technologies and ElSewedy Electric Co to build out an AI data centre in Egypt, and will look in other markets such as South Africa and Kenya, he said in an interview. He didn’t comment on the funding requirement.
“Egypt, Kenya, South Africa are our bigger markets, “Joosub said. “It will be a big investment, and that is why we’re bringing on partners.”
Within the joint-venture structures, the data centres will be funded by equity and debt, he said.
“On the one side we will have a stake in the data centre, and on the other side we will probably do the lion’s share of the sales of the data centre to customers, “he said.
While Africa has the fastest-growing and youngest population globally, it has fallen behind in the movement to build out local AI computing. It houses less than 1% of data-centre capacity, marking a significant infrastructure gap in the rapidly growing field.
South Africa, the continent’s most powerful economy, currently hosts most of the continent’s computing power, with hyperscalers including Microsoft Corp, Alibaba Group Holding, and Amazon.com offering cloud services.
Vodacom’s cross-town rival, MTN Group, recently also partnered with a Middle East-based investment platform founded by Tarek Al Ashram to start the buildout of AI data centres in Nigeria and South Africa. The additional build out of AI data centres across Africa will also provide more localised options for hyperscalers.
During the six months through September 30, Vodacom, which is majority-owned by the UK’s Vodafone Group Plc, raised profit by 26%. The company’s shares were up almost 5% in Johannesburg on Tuesday to value the firm at $22 billion.
The increase follows Vodacom’s move to take control of Safaricom Plc — Kenya’s largest wireless carrier — after it completed the purchase of an additional 20% stake in June to lift its interest to 55%.
That holding is now subject to a legal battle in the country, with the High Court last month declaring the government’s sale of a 15% holding to Vodacom unconstitutional and ordering the shares returned to the state. An appeals court has since allowed Vodacom to retain the shares while fast-tracking an appeal of the ruling.
The firm declared an interim dividend of R3.55, 7.6% higher than a year earlier. Customers increased 12% to a record 250 million.