JSE-listed Accord Technologies has agreed to sell Accord Business Solutions and Datagate Software to fellow listed company Prism Holdings for R88 million.
Prism is to pay R40 million in cash, while the remainder is to be paid through the issue of 8 million shares at 600c each, giving Accord a 4% stake in Prism. Accord CEO Brandon Saldsman has been made a non-executive director at Prism.
The acquisition includes Accord`s Wireless Application Protocol (WAP) technology and Java development teams.
The companies say the deal with help them both focus on their targeted niche areas.
Accord Business Solutions is a focused software development house in the Java and Corba-related software space, providing mobile commerce-related software and systems resources on an outsource basis.
Datagate specialises in mobile communications and transaction connectivity.
Accord is planning to focus on telecommunications, while Prism is a secure electronic payments and transactions technology company.
"In the mobile arena, time to market matters," says Prism CEO Alvin Els. "Our acquisition of Accord`s back-end m-commerce technology and expertise will accelerate the pace at which we attain critical mass and position us as the quickest route to market for companies wishing to transact over mobile networks and the Internet."
He adds that the Accord entities will be integrated as quickly as possible.
"The current profits generated by the entities we are absorbing are less significant than the medium-term potential of being this region`s strongest m-commerce developer."
Saldsman says Accord retains significant intellectual property to drive its mobile Internet service provider initiatives, which include the provision of mobile data support and training as well as the operation and management of Web and WAP-based front-end services.
Had the deal taken place in the six months to 31 December 1999, Prism`s earnings per share would have been 3.7% higher at 5.61c, with net asset value per share 65.9% up at 105.95c. Tangible net asset value would have been 3.4% lower at 49.43c a share.
Accord`s earnings per share, had the deal taken place in its interim period to 30 September 1999, would have been 3.3% up at 4.97c, while net asset value and tangible net asset value would have been 119.9% higher at 63.43c a share.
Prism`s share was trading at 660c late on Tuesday morning, 40c or 5.71% down from Monday`s close, while Accord was trading 1c or 0.97% lower at 102c.
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