JSE-listed EOH, which has seen a trend of strong financial results over the past couple of years, is planning to massively expand its footprint in Middle East and Africa (MEA).
The technology group yesterday announced it has concluded the acquisition of 50% or more in Consol Systems (Morocco), BC Skills (Morocco), Acron (Turkey and Iran), Cozumevi (Turkey), and EBS (Mozambique).
Asher Bohbot, EOH Group CEO, says the acquisitions will serve as a base for the company to grow aggressively in these territories, both organically and through further acquisitions, by providing EOH with a vast range of service offerings which are all relevant to these economies.
The company has also set up offices in the United Arab Emirates to serve the region.
The IT services company has a staff of around 9 000, including more than 1 000 employees in 33 countries outside of SA. The company offers end-to-end enterprise applications solutions, a range of outsourcing, cloud, managed services, and business service offerings to enterprises with a focus on financial services, telecommunications, public sector, mining, manufacturing, and retail.
EOH plans to grow revenue outside SA through acquisitions and organic growth. Its businesses on the continent, excluding SA, account for 10% of total revenue and the target is to increase this to about 30% in the medium term.
Last year, EOH announced three major local acquisitions. In February, it bought CCS, which provides integrated niche management solutions for the construction and mining industry sectors, for an undisclosed sum. CCS then had a turnover in excess of R200 million, and presence in 50 countries, including SA, Middle East, Europe, Australia and South America.
In June, the company announced it was acquiring an equity stake of between 49% and 80% in pan-African IT applications and business solutions provider Twenty Third Century Systems and its subsidiaries, for an undisclosed amount.
In October, the company announced the acquisition of Mehleketo, a local provider of rail automation and technology solutions, also for an undisclosed amount. Mehleketo had a turnover of over R300 million, technology partnerships with the major international rail automation technology original equipment manufacturers, and about 350 employees.
The voluntary announcement made by EOH yesterday helped raise its share price by 2% on the JSE. For the year ended 31 July, EOH revenue was up by 35% to R9.7 billion. Investors were then concerned if the company was going to maintain the growth, with analysts predicting the growth was going to soften as EOH matures.
EOH's growth for the six-month period to 31 January is expected to again be positive, with significant year-on-year growth in revenue, profit and headline earning per share, the company says.
A detailed trading update will be published during the second half of February, it points out, adding the interim results for the six months ending 31 January will be published on 9 March.
This morning, EOH shares traded at R127.95 per share.
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