Logicalis, a subsidiary of JSE-listed Datatec, has sold its Australian and New Zealand operations, comprising Regreb and its subsidiaries, Logicalis Australia and Logicalis CSI, to IBM for $66 million in cash, including working capital adjustments.
The move results in a change of focus for the group, which says it will now concentrate its management and financial resources on the US and UK markets, "where there is considerable experience and scope for growth".
Datatec and Logicalis CEO Jens Montanana says the group had not originally intended to sell the operations, which at 31 August last year accounted for 26% of Logicalis`s consolidated revenue and a quarter of its net assets.
"These operations were central to our integration and services strategy internationally," he says, adding that the aim had in fact been to grow the operations.
"However, the nature and value of this unsolicited offer was very compelling, particularly given that the suitor was IBM and the payment is entirely in the form of cash.
"The Datatec board is of the opinion that the disposal will enhance shareholder value. The total consideration represents a significant premium to the historical investment cost."
Of the total proceeds, Logicalis will receive cash of $46 million for the equity and a repayment of intercompany loans and payables amounting to $20 million.
The group says it will use the proceeds of the sale to strengthen its balance sheet and for potential acquisitions.
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