Altron is looking at bringing in an empowerment partner at group level after integrating Altech into its operations and buying out some minorities.
Last May, Altron put a R1.8 billion offer on the table to buy the shares in Altech it did not already own. That move led to the creation of Altron TMT, which is the combination of Bytes and Altech.
Integrating Bytes and Altech has led to cross-selling opportunities for the group, and helped it partially stave off underperformance at Powertech during the six months to August. Overall, revenue gained 6% to R14.2 billion, but normalised earnings before interest, tax, depreciation and amortisation dropped 10% to R784 million.
The decline came as Powertech was adversely affected by slow government spending and the month-long metalworkers strike. Altron TMT faired better, growing turnover 8% to R10 billion, while earnings before interest, tax, depreciation and amortisation improved 10% to R702 million in the six months to August.
Speaking at the results presentation yesterday, CEO Robert Venter said Altron is now looking to implement black economic empowerment at group level, instead of at its divisions.
This comes after the company, in May, said Bytes SA had bought out its empowerment partners in a R699 million deal, bringing to an end a 10-year relationship. The local unit of Bytes Technology Holdings bought back the 27% stake from a consortium led by Kagiso Strategic Investments, which is indirectly owned by Kagiso Tiso Holdings.
Kagiso has been Bytes' empowerment partner since 2004 and - despite the buyback - Bytes remained a level two contributor, with level one being the highest possible level in terms of government's empowerment scorecard.
Altron's empowerment score, measured in March, also shows it is a level two contributor, with 19 out of 20 possible points being scored on the ownership level. Altech is also a level two contributor, with 20 ownership points, while Powertech is at level four.
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