IST forming alliance to back expansion

Johannesburg, 10 Jul 2002

Technology group IST is finalising an alliance between IST Energy and what it says is one of the world leaders in power engineering.

IST Group CEO Harry Coetzee says in a newsletter to stakeholders the alliance is designed to ensure that IST has the products to compete as it expands into African and Middle Eastern markets.

"At the same time it will enable us to offer the latest international technology to the local power systems market, backed by strong on-the-spot support."

The group is hoping to announce details soon.

IST indicated in its annual report, released in May, that it was actively seeking acquisitions to expand its businesses.

The new growth path is aimed at diversifying the group, strengthening the position of its operations in their markets and, where possible, increasing hard currency earnings.

IST`s divisions operate in the fields of energy, fuel and asset management systems; embedded software products for the international defence industry; specialised electronic equipment and software for electrical utilities; multi-disciplinary turnkey systems and plants; data and voice access networks for the telecommunications industry; utility information solutions; and energy management systems.

It is also involved in the Pebble Bed Modular Reactor nuclear project.

Coetzee says the group`s businesses are generally in good shape and there have been several positive developments at the operational level in the past few weeks.

The refocusing of IST Industrial on designing and supplying systems and plants for mining and industry has borne fruit, with a surge in work volume, including a R50 million contract for upgrading and expanding the compressed air system at the Hillside aluminium smelter.

It also has a R30 million contract for doubling up the compressed air plant at the Mozal aluminium smelter and the construction of an off-gas cleaning plant at the Bayside smelter.

IST Telecom, which recently won the Telkom annual award for the supplier with the best performance in the quality category, has won a contract to supply access multiplexers to Rodcor International for a new optical fibre-based telephone network in Swaziland.

However, Coetzee warns that overall the telecoms market remains soft.

IST Energy has had its national contracts for the supply of remote terminal units and post-mounted terminal units extended by Eskom. It has also won new national contracts for the supply of remote terminal units for transmission substation control system applications and for transmission bus coupler protection and control systems.

The group`s listing was moved from the JSE`s electronic and electrical equipment sector to software and computer services as part of the move to the FTSE classification system. Coetzee says IST is asking the JSE to review this as it does not believe the software and computer services listing reflects the nature of its business.

The IST share, which lost 4c to close at 110c yesterday, was trading at 114c by midmorning today.