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DTC - Datatec -Disposal of 55% stake in African Legend Indigo
DATATEC LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1994/005004/06)
ISIN: ZAE000017745
Share Code: DTC
("Datatec")
DISPOSAL OF 55% STAKE IN AFRICAN LEGEND INDIGO
1. Introduction and Rationale
Datatec announces that, following a strategic review of its South African
assets, it has decided to focus on growing its Westcon distribution
business in South Africa and to divest its shareholding in African Legend
Indigo (Pty) Ltd ("ALI"), a major partner of Sun Microsystems in South
Africa.
As a result of this decision Datatec has increased its ownership in Westcon
SA (Proprietary) Ltd ("Westcon SA") from 55% to 74.9% through the disposal
of its 55% stake in ALI and the issue of 275 578 new Datatec shares (the
"Transaction").
2. The Transaction
2.1 The businesses
Westcon SA is a distributor of ICT equipment and forms part of
Datatec`s Westcon Emerging Markets Group. ALI is a systems integrator
and enterprise management solutions provider and one of South Africa`s
leading Sun Microsystems Value Added Resellers.
Both Westcon SA and ALI were 55% owned by Datatec prior to the
Transaction in partnership with African Legend Computing ("ALC") as a
minority Black Economic Empowerment ("BEE") partner.
2.2 Consideration
The Transaction has been effected by a Share Sale Agreement signed on
24th April 2009 under the terms of which Datatec will purchase 19.9%
of the shares and shareholder equity loans in Westcon SA from ALC for
a consideration of R12.7 million made up of 55% of the shares and
equity loans in ALI plus 275 578 new Datatec shares to a value of R4.0
million. The net result of the Transaction is that Datatec now owns
74.9% of the shares in Westcon SA, with ALC owning the remaining
25.1%, and ALC now owns 100% of ALI.
2.3 Financial effects
The pro forma financial effects of the Transaction on Datatec`s
earnings per share, headline earnings per share, net asset value per
share and net tangible asset value per share for the period ended 31
August 2008 are not significant (i.e. are less than 3%), and have
therefore not been disclosed.
3. CONDITIONS PRECEDENT AND LISTING
The implementation of the Transaction is not subject to any conditions
precedent and is accordingly immediately effective.
Application has been made to the London Stock Exchange for the admission of
the new Datatec shares to the Alternative Investment Market, and to the JSE
Limited ("JSE") for the listing of these shares. Listing on both exchanges
is expected to become effective on 6 May 2009.
4. SMALL RELATED PARTY TRANSACTION
The majority shareholder in ALC is a director of a Datatec subsidiary and
ALC is therefore a related party to Datatec. The Listings Requirements of
the JSE require written confirmation from an independent professional
expert, confirming that the Transaction is fair to Datatec`s shareholders.
Moore Stephens (Jhb) Corporate Finance (Pty) Ltd, as the independent
professional expert acceptable to the JSE, has confirmed that the
Transaction is fair and their fairness opinion is available for inspection
at Datatec`s registered office until 26 May 2009.
Sandton
28 April 2009
Merchant bank and sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 28/04/2009 08:30:01 Produced by the JSE SENS Department.
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