Troubled technology group Altron has signed a binding agreement to dispose of its long-held subsidiary Aberdare Group for R1,2bn in cash.
Altron subsidiary Powertech, which owns Aberdare, has entered into binding agreements to sell Hengtong Optic – Electric a controlling equity stake in Aberdare Cables South Africa and a 100% equity stake in Aberdare Europe, comprising its Spanish and Portuguese operations.
Powertech will retain a 17,5% interest in Aberdare Cables’ South African operation for a period of about two years, after which Hengtong will purchase Powertech’s stake at the same valuation as the initial transaction.
The transaction excludes the CBI Electric Aberdare ATC Telecom Cables joint venture in which Aberdare Cables holds a 50% equity stake, as well as the 49% equity stake in Alcon Marepha, which has been sold separately for R19m.
Listed on the Shanghai Stock Exchange, Hengtong is the fourth largest cable manufacturer in China and one of the largest cable manufacturers in the world, Altron said in a statement.
“We have disposed of a number of assets in recent months as part of our strategy to focus on core businesses and reduce our exposure to manufacturing,” said Altron CEO Robbie Venter in the statement.
“The sale to Hengtong is the right move for Aberdare as Hengtong is well suited to support and develop the Aberdare Cables group through procurement benefits, product expansion, systems development, geographic expansion and technical expertise,” he added.
Atron’s share price was trading up by 3,8% at R5,20/share shortly after the news of the sale was announced on Monday. In the past year, the counter has shed 61,5% of its value. — (c) 2016 NewsCentral Media