EOH Holdings subsidiary EOH Abantu has agreed to sell its shares in Dental Information Systems (Denis Group) to AfroCentric Investment Corp for an effective R250-million.
Denis Group and its subsidiaries were acquired by EOH in 2012 to provide the group with “healthcare technology capability and dental claims risk management as well as dental insurance intellectual property”, the JSE-listed IT services group said in a statement to shareholders on Friday.
The sale of the business is in line with EOH’s strategy to offload non-core assets.
AfroCentric is a black-owned investment holding company with a presence in the healthcare industry. Assets include Medscheme, a medical scheme administrator.
“The Denis Group business is aligned with AfroCentric’s strategic growth objectives and the transaction is considered a compelling opportunity for Denis employees,” EOH said.
The proceeds of the sale will be used to reduce EOH debt, which, it said, is consistent with its objective of creating a “fit-for-purpose capital structure”.
Disposals
The value of the consolidated net assets of the Denis Group at 31 July 2019 was R145.4-million. Its profit after tax, attributable to its net assets, was R34.8-million.
EOH set a target of achieving R1-billion from disposals in 2019. It said it has “exceeded this target and as at 13 December 2019 has entered into agreements with a cumulative value in excess of this amount”.
The sale of Denis Group is subject to Competition Commission approval, with the sale expected to be concluded by April 2020. — © 2019 NewsCentral Media