JSE-listed ConvergeNet will sell its remaining 15.05% stake in Future Cell to Pepkor, for R40 million.
The proceeds will be more profitably invested in a return of cash to shareholders through a share buyback, and investing in expansion plans that have been approved for its core operating subsidiaries, it says.
ConvergeNet says Future Cell is a focused mobile telecommunications company and operates in the prepaid distribution business. “The company is characterised by strong systems, processes and skills in this market,” it says in a statement.
Future Cell distributes its prepaid products in a number of provinces countrywide.
ConvergeNet's board has decided the company should exit sub-scale or loss-making business units, as well as minority interests where it has no strategic influence.
“The strategy going forward will be to focus on identified core operations, and to grow these organically and via a disciplined acquisition strategy,” it says.
Future Cell's sale was initially expected to take place towards the end of next year, but the board decided it would be in ConvergeNet's best interests to accelerate the sale.
The deal is subject to several conditions.
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