Bytes Technology Group (BTG) has bought Xerox`s stake in joint venture Xerox SA for R235 million.
The deals sees BTG, which already had 50% minus a share, take full ownership of the company. Bytes previously had management control of Xerox SA.
Xerox SA, to be renamed Xeratech, has entered a 10-year exclusive distributorship agreement with Xerox to continue distributing Xerox products in SA and neighbouring countries. It also retains the right to use the Xerox trademarks and logo.
BTG says while Xerox owned a controlling equity interest in Xerox SA, it did not have management control in terms of the joint venture agreement.
"Xerox Limited has made a strategic decision to change the nature of its business relationship in SA from that of a joint venture to that of an independent distributor," it says.
"This decision afforded BTG the opportunity to make Xerox SA a wholly owned subsidiary, which offers BTG significant advantages.
"Although BTG had management control of Xerox SA it did not have unfettered control over its cash flows. The acquisition of the Xerox interest will enable BTG to obtain direct access to the cash flows of Xerox SA and will enable it to utilise such cash flows optimally within the BTG group."
It says the acquisition will also enhance its own earnings.
Julie Limoli, president of Xerox Middle East, India, Eurasia, Russia and Africa, says the sale is consistent with Xerox`s strategy of meeting market needs through working with local partners and is similar to changes it has made in other markets.
Xerox SA MD Rob Abraham will continue as MD of Xeratech.
"Our South African customers will continue to receive the latest Xerox products as they are launched internationally and will experience the same levels of service that they have come to enjoy," he says.
The deal is subject to regulatory and shareholder approval.
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