Blue Label Telecoms is expanding its distribution channels with the acquisition of a 75% stake in Via Media, a mobile content and value-added services provider.
The group will initially spend R144.4 million on the stake, which it will buy from Malik Investment Holdings, and then as much as another R103.1 million if Via Media meets certain profit warranties over a three-year period.
The company notes an additional maximum amount of R112.5 million will be paid if certain additional "stretched targets" are met. The amounts will be paid out of its cash reserves.
In a statement, Blue Label explains Via, which is a mobile content and value-added services provider, has a technology platform that connects to all South African mobile networks, through which it offers premium-rated SMSes, online billing, multimedia messaging, WAP and Web services, unstructured supplementary services data and interactive voice response.
"Via Media offers its partners the ability to sell mobile entertainment, information and communication services to consumers through a variety of media and technology channels."
Buying the stake will allow the listed company access to new channels for the distribution of both Via Media and its products and services, it says.
Blue Label expects the stake to increase its earnings and headline earnings per share by more than 5%.
Share