South African records and information management firm Metrofile has announced its intention to acquire G4S Secure Data Solutions Kenya (SDS Kenya), the largest records management company in East Africa.
According to a JSE announcement, the company concluded a share purchase agreement to buy the Kenyan company from UK-based G4S International Holdings and from Kenyan Nurun Investments.
SDS Kenya operates a records management business based in Nairobi, Kenya, specialising in all aspects of corporate archiving and record management, including storage, indexing, retrieval, tracking, archiving and records management digital services.
"The board believes that the Kenyan records management market has significant potential for growth, and that SDS Kenya is a well-established business that will provide an ideal strategic platform to extend Metrofile's presence in the broader East Africa region," said Metrofile.
"The company said the maximum purchase consideration of SDS Kenya is KES2.125 billion (R281, 4 million).This will be settled in cash from Metrofile's existing resources and a facility arranged for this purpose with Standard Bank," it added.
The Metrofile board is also considering a capital raise of up to R100 million by way of an underwritten rights issue to reduce the bank debt utilised to fund the purchase consideration.
According to the JSE-listed firm, the deal is a strategic move which will increase its footprint in Africa and provide it with an expanded international client base, strong management team and local expertise in the records management industry.
"The transaction demonstrates Metrofile's positive intention to continue the rollout of its services into selected African countries through organic as well as acquisitive growth. The transaction is also in line with G4S' stated intention to dispose of operations not core to its security business," the company noted.
The transaction is still subject to approval by the competition commission, which is expected to be happen on or before 31 January 2018.
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