Bytes on the hunt

Bytes Technology Group is on the hunt for acquisitions as a three-year moratorium comes to an end.

Parent company Altron sees opportunities for takeovers emerging in the IT space. CEO Robert Venter says Bytes is “actively looking for opportunities” now that companies are being sold at more reasonable prices.

Altron, with R1.25 billion in the bank, is in a position to be a consolidator when opportunities arise, says Venter. The cash gives the group flexibility when it comes to takeovers, he adds.

Acquisitions by both Bytes and Powertech had been on hold for about three years, as the companies were under pressure due to challenging economic times, says Venter. However, as both units grew “nicely” in the year to February, acquisitions are back on the radar, he says.

Bytes had a “good year,” says Venter. He says the unit gained market share in the retail and financial services sector. Bytes grew revenue 2%, to R6 billion, during the year to February and bolstered headline earnings 32%, to R208 million.

The unit has successfully been turned around after headline earnings per share dropped 21% when the company presented year-end results last May.

Venter says Altron's acquisition strategy is not to expand outside of its three core units - IT, telecoms and power, but to stay focused on those areas. Deals will be done in SA and internationally, he says.

Bytes is looking at a potential deal in the UK as the company wants to expand its range of offerings to match its South African business, says Venter. Currently, Bytes plays in the Microsoft licensing and office automation space in the UK.

Venter says Bytes will expand in the UK to offer aspects such as managed services and security. However, companies are currently cheaper to buy in SA than the UK.

Bytes will also be looking for opportunities on the continent, says Venter. However, buying companies in Africa is risky and requires careful planning.