Business Connexion (BCX) wants shareholders to allow it to buy back shares with the R191 million freed up through the settlement of a tax dispute.
The dispute centred on the value of the Persetel and Q Data trademarks claimed as a deduction from BCX`s (formerly Comparex`s) taxable income for the financial years 1995 to 2004.
Earlier this month BCX announced that it had reached a settlement with the South African Revenue Service (SARS), with the group agreeing to pay SARS R159 million.
Before the settlement, BCX had indicated that its total exposure, including interest might amount to up to R350 million, and it had retained funds to cover this.
The fact that the settlement amount was only R159 million has freed up R191 million.
BCX says this money is not needed for working capital purchases. The group is "reviewing its options in respect of its cash holdings, one of which is the repurchase of its shares on the JSE".
The group is to post a circular to shareholders today asking them to grant, at a meeting scheduled for 23 May, a general authority to repurchase shares on the JSE.
It says in a notice to shareholders that the general authority will provide the board with flexibility to buy shares "should it be in the interest of the company at any time while the general authority exists".
The BCX share closed at 444c on the JSE on Tuesday, ahead of yesterday`s public holiday. This was 1c or 0.2% down on Monday`s close.
Related story:
BCX tax dispute is over
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