Bytes Technology Group has emerged as the preferred bidder for CS Holdings.
Bytes is the fourth JSE-listed company to indicate plans to make an offer for CS Holdings. The three previous suitors - Reunert, EOH and UCS Group - all walked away from making a deal.
Bytes chairman and CEO Dave Redshaw was out of the office this morning and could not be reached for comment. However, a Bytes staff member says although Bytes and CSH are in talks, a due diligence exercise has yet to take place.
Reunert, already a shareholder in CSH, withdrew from talks after failing to reach agreement on certain issues. UCS cited external factors rather than problems with the CSH business, while EOH has said it has a confidentiality agreement with CSH and will not comment on the reasons for its decision not to proceed with an offer.
An analyst says while he is concerned that three companies have already walked away from making an offer, Bytes, and the Altron group of which it is a part, is large enough to be able to deal with potential problems at CSH that could have made things difficult for UCS and EOH.
"I don`t know if things are worse at CS than we thought previously, but things have been pointing in that direction," he says. "I don`t think three companies are going to back away if everything`s fine. But David Redshaw did such a good job at fixing up Usko (now Bytes) that if there are problems, he`s the guy to sort them out."
Related story:
EOH backs off from CS Holdings
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