The success story of IT group Masana Technologies confirms the wisdom of its parent's strategy, despite the criticism of Peu's cautious approach.

One message comes out loud and clear from Peu's leadership: "We are creators of viable and sustainable businesses."

The message is heard from all top executives with such clarity that one may think the group has rehearsed it. And Masana is the ideal representation of this vision.

Peu also looks for BEE stakes in major corporations, but says this is only one part of the business.

"We are focusing on building businesses and enterprises, with high growth potential," says Peu financial director Busi Tshili.

Masana represents this.

Masana, which is a 100%-owned Peu subsidiary, was started by Peu from scratch in 1999.

The company focuses on providing IT services mainly to the public sector. "We also focus on the public sector because it is one of the most attractive market segments in terms of IT spend," says Masana CEO Duncan Todd.

"There is lot of automation taking place in the sector. The sector is also looking for competent and proven empowerment service providers. We have proved we are competent and we are 100% black owned," says Todd.

Some of the services offered by Masana include outsourcing desktop support, network management, server management, application support, project management and procurement services.

Masana started operations with a multimillion rand contract with the City of Johannesburg. This was a bold move for the city, showing its foresight on empowerment.

"We started as junior partner, walking alongside IBM, but we have grown to become a prime contractor in our own right," says Todd.

He says the company is moving up the food chain towards systems integration and business process management. "Our proposition is to become a single service aggregator to our clients," says Todd.

Masana grew its employee base from two-and-a-half people (Ghandi Badela and Mandla Ndlovu formed the start-up team, with MD Peter Malungani as the half) at inception to about 80 within the first five years of operation. It now employs about 200 people. Zeb Mothibe, another CA, is CFO, Kgotso Chikane is director for strategy and business development and Hugo Knoetze is chief operating officer.

Todd credits Masana's parent company Peu with this success.

"It's a blessing to have an entrepreneurial organisation as a shareholder," he says.

"It has more understanding of our challenges than another shareholder would have had," says Todd.

As a 100% black-owned entity, Masana is expected to set an example in terms of transformation at shopfloor level.

Todd says the group has an undivided commitment to transformation. "We recently signed a new contract and had to increase our staff. We recruited 50 people; four of them were white. Most people cannot believe we did that so soon because there is a lack of experienced black skills in the market.

"Our commitment to transformation is not about compliance, it's about who we are - a wholly owned black company," says Todd.

In view of this commitment to transformation, Peu investment banking executive Thuli Zuma says: "In its own way, Peu is contributing to the broad transformation of the country. That is part of the reason I joined the company."

Malungani says corporate objectives would be largely fulfilled if the group creates two or three bigger Masana-type businesses in the short to medium term in selected sectors.