JSE-listed telecommunications equipment and electronics company Jasco has made an offer to buy another fellow listed company, communications business Spescom.
Jasco CEO Martin Lotz says the combination of the two businesses will create a business with annual turnover of R1bn.
“We have always looked at both organic and acquisitive growth and the deal would bring many opportunities to Jasco,” he says.
The transaction will be settled through the issue of 32,9m ordinary shares made up of one Jasco ordinary share for every 2,47 Spescom ordinary shares.
“We will also pay a cash amount of 15c per Spescom share, which comes to R11,8m,” says Lotz.
With the flood of bandwidth coming to the African continent, Lotz says concluding the deal will give the merged company a significant opportunity in the telecoms sector.
Spescom has a presence in SA, sub-Saharan Africa, Europe, and the Middle East. It has a staff complement of 258 with offices located in SA, the UK and Uganda and plays in the converged communications space.
The acquisition will also give Jasco access to a telecoms network licence owned by Spescom.
Jasco already supplies network access equipment to telecoms providers and the network licence could give it an opportunity to compete more directly. Lotz says he is not looking to compete directly with local telecoms companies, at least not yet. “The licence does give us the opportunity to look at it in the future.”
He says a deal with Spescom should increase the liquidity of Jasco’s shares.
If all the shareholders and the relevant authorities approve the deal, Lotz will become the CEO of the merged business and Spescom CEO Jené Palmer will stay on to facilitate the conclusion of the sale.
Jasco has received agreement from 58,8% of its shareholders and Spescom has approval from 40,1%. — Candice Jones, TechCentral
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