US-based technology firm Novatel is offering shareholders of JSE-listed DigiCore Holdings R4,40/share, or R1,1bn in total, to buy the business. This offer has sent Digicore’s share price up by more than 15% in morning trade on Friday.
The R4,40/share offer is higher than a previous proposed offer, made in early June, of R4/share.
DigiCore is a specialist in vehicle tracking technology and owns the Ctrack brand, while Novatel describes itself as a developer of machine-to-machine wireless solutions based on 3G and 4G technologies
The San Diego, California-based Novatel, which is listed on the Nasdaq stock exchange with a market capitalisation of US$180m, specialises in “Internet of things” and cloud-based software-as-a-service solutions and sells MiFi mobile hotspots, USB modems, and mobile and asset tracking solutions.
“Novatel believes that its acquisition of DigiCore will establish Novatel’s position as a significant player in the global asset tracking and management market, and would provide immediate top-line contribution and meaningful earnings contribution in 2016,” Digicore said in a statement to shareholders.
The R4,40/share offer represents a premium of 68% to the 30-day average price of DigiCore of R2,62/share as at 7 May 2015.
The deal remains subject to various approvals, including from the South African competition authorities and the South African Reserve Bank. — (c) 2015 NewsCentral Media
