EDS South Africa said on Tuesday it was looking for a local acquisition but denied what it called market rumor that it might buy the country's biggest technology company, Dimension Data.
"EDS is, financially, well placed to consider an acquisition as part of its local growth strategy... but Dimension Data does not form part of our plans at this stage," EDS South Africa Chairman Michael Minassian said in a statement.
EDS South Africa spokesman Charles Webster said the group had received a number of calls from "business contacts and journalists" concerning a possible offer for Didata, which has seen its share price tumble close to four-year lows in the past two weeks after it warned of lower annual operating margins.
Didata and many analysts said the announcement was the first they had heard of the so-called rumour.
"I've never heard of it," Didata spokesperson Karen Cramer told Reuters, adding the group's lower share price could be to blame for any takeover talk.
"I hadn't even heard it. EDS South Africa was probably just trying to get some news space," said an analyst.
"Their model is very different from Didata's. They are a pure outsourcing company and I wouldn't pay too much attention to this," said another.
"EDS is primarily a services company and would not want to purchase a product resale-driven operation," Minassian said. About 60 percent of Didata's revenue comes from hardware sales.
EDS South Africa is part of U.S. computer services group Electronic Data Systems Corp. Webster would not give local revenue figures, but said EDS South Africa employed 1,200 people, compared with its parent's worldwide total of 120,000.
He also declined to give details of EDS South Africa's likely local acquisition targets.
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