Johannesburg, 24 Nov 2003
In the biggest empowerment deal in South Africa`s IT hardware industry, Safika Holdings is to purchase a major share of listed IT company Mustek in a deal worth an estimated R224-million. Mustek is now the only listed South African IT hardware company to be significantly empowered," said Vuli Cuba, Safika`s chief executive. Cuba who will become deputy non-executive chairman of Mustek said: "Safika will play a key role in Mustek`s drive into the parastatal market in South Africa, while consolidating its position within government IT procurement."
Mustek which is listed in South Africa and Taiwan, generated revenues of nearly R3-billion in 2003, 60 per cent of which was generated from the sale of computers. The company is the holding entity for a number of local IT companies, including, Mecer, the top-selling PC brand in South Africa since 1992; the Brother brand of printers and multi function units; Rectron, the leading computer component and peripheral distributor and Comztek, a network and software provider.
In terms of the deal Safika will acquire 25%, plus one share, of Mustek over the next five years. As soon as the deal becomes unconditional it will have 25% plus one of the voting rights.
Mustek chief executive David Kan said: "This deal represents empowerment and value-add in its broadest sense. Because of Safika`s involvement Mustek will be able to significantly grow its business in the next five years and create many more jobs. Safika will also play a vital role in helping to transform the company, bringing in skills at all levels." Kan said that the deal would not be dilutive to existing shareholders.
In addition to Cuba`s role as deputy chairman, Safika will have the right to appoint one executive director, and identify an independent non-executive to serve on the board. Safika has considerable experience in the IT industry. It established Safika Technologies Holdings in 1996 as a vehicle for black economic empowerment within the information technology and telecommunications sector and has two operational subsidiaries, Safika Technologies and Safika BEA Systems.
Additionally, Safika holds 70% of SafikaTel (Pty.) Ltd, which specialises in interactive marketing using fixed or mobile competition and customer information lines and one of the first companies in South Africa to offer fax-to-email facilities that allows for faxes to be saved, stored or forwarded from a laptop or PC.
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