Business Connexion shareholders have voted overwhelmingly in favour of a R2,7bn all-cash offer from Telkom, paving the way for a review by South Africa’s competition authorities and communications regulator Icasa.
Telkom has offered BCX shareholders R6,60/share to buy 100% of the company. The deal is seen as important for Telkom, which is keen to expand into higher value — and possibly higher margin — IT services to complement its telecommunications business.
It was unlikely that there would have been an upset at Monday’s meeting, where shareholders voted. Last week, Telkom said it had already received written assurances from shareholders representing 80% of BCX’s equity that they would vote in favour of the deal.
BCX CEO Isaac Mophatlane said last month that he hoped the transaction would be finalised by late November or early December. He warned, however, that it could be delayed if the proposed deal is challenged at the Competition Commission.
It’s the second time in seven years that the company has made an offer to buy the JSE-listed IT services company. The first time around, the competition authorities blocked the transaction fearing the impact it would have on competition in the information and communications technology industry.
But Mophatlane said the market had changed significantly since then and Telkom was no longer in a dominant position.
BCX share price was trading up by 0,3% at R6,42/share at lunchtime on Monday; Telkom was trading 1,9% higher at R54,79/share. — © 2014 NewsCentral Media