Shares of Dimension Data shareholders will be exchanged for shares in Dimension Data Holdings plc on a one-for-one basis, says chairman and CEO Jeremy Ord, who predicts an inflow of foreign exchange to SA.
This follows an announcement that the group will be renamed Dimension Data Holdings plc after it received approval from the finance ministry to go ahead with moving its primary listing to London.
The group says its headquarters and tax domicile will remain in SA, and in terms of SA exchange control regulations, South African residents will be allowed to trade their Dimension Data Holdings plc shares only on the JSE, where a secondary listing will be retained.
"With Dimension Data`s larger shareholder base and higher global profile, there is likely to be growing international demand for Dimension Data shares. The chances of SA shareholders selling to foreign investors will rise and this will result in an inflow foreign exchange to SA," he says.
Ord says the group aims to raise about $1.25 billion, which will see its market capitalisation increase to about $8.6 billion, making the group the largest IT company on the London Stock Exchange.
He adds that Dimension Data Holdings plc will also qualify for inclusion in the FTSE 100 index in about 56th position.
This will enable the group to buy out certain minorities; fund acquisitions, particularly in the US and interactive commerce (i-commerce) arena; facilitate the continued development and roll-out of its managed network services strategy; and implement a global share option scheme for employees.
"The listing of Dimension Data Holdings plc on the LSE and the associated fundraising is an essential step in the continued international development of the group. The new structure will allow us to accelerate our international expansion while retaining our SA base. It will also enhance our position as a leading global provider of network and i-commerce solutions and services.
"We believe this proposal is in the best interests of our shareholders and an estimated 50% have already indicated their support in principle," Ord adds.
A meeting of shareholders at which a final decision will be taken is scheduled for late June and documentation relating to this meeting, along with details of the proposal, will be posted to shareholders this week.
Subject to shareholder approval being obtained, the group expects Dimension Data Holdings plc shares to start trading on the LSE and JSE in the third quarter of 2000.
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