Technology firm Allied Technologies Ltd on Thursday announced plans for a major boost to internet connections in east Africa and said it expects to double profit in the region by early next year.

Altech, one of Africa's biggest connectivity providers, said it bought 5 gigabytes of capacity from undersea cable provider SEACOM with an option to double it within the next three years.

The deal will allow Altech, through its unit Kenya Data Networks (KDN), to expand web services to countries like Kenya, Uganda, Rwanda, Democratic Republic of Congo and Tanzania.

Altech was needing a great engine to push things forward ... but I think this alliance with SEACOM takes it into the next level, said Altech Chief Executive Officer Craig Venter.

We, in this current financial year, see profit contribution from east Africa and the growth that's going to come from that region, we see that doubling, he said.

Altech's east Africa operations made about 114 million rand and about 20 percent of group earnings in the year to end February 2008.


Altech, which expects 500 million rand cash flow by year-end, is spending 400 million rand to boost bandwidth in east Africa where it said broadband demand would increase ten-fold in the next years.

The east African market has been enormous, said Brian Herlihy, chief executive officer of SEACOM, adding the regulatory environment was more relaxed in the region than South Africa.

He said the footprints were in place to have the South African market moving at a faster pace than it was currently, but the country still had a long way to go.

It's also ironic to see east Africa, which was expected to be our secondary market, actually larger and moving faster than the South African market, Herlihy added.

Shares in Altech were up 2.14 percent to 64.35 rand by 1447 GMT, slightly higher than a firmer JSE All-share index .

($1=7.305 Rand)

(Editing by David Cowell)