Sekunjalo Investments, a JSE-listed black economic empowerment investment company, has bought 24% of XN Corporation Africa, a subsidiary of London-listed XN Checkout.
The acquisition carries a price tag of R5 million.
However, Sekunjalo MD Gilingwe Mayende says the deal in fact buys his group assets worth R25 million in London on the basis of attributable earnings from XN Corporation Africa.
Mayende is to be the Sekunjalo representative on the board of XN, a provider of IT services to the leisure, retail and gaming industry.
"Sekunjalo has now built up an IT portfolio of over R150 million, which includes its investments in Semtech (Sekunjalo Enterprise Management Technology), Health Systems Technologies, Synergy Computing and now XN," Mayende says.
He adds that last year the group made a total of R13 million before tax, the bulk of which came from 80% subsidiary Premier Fishing.
"The combined profitability of these IT operations is expected to be over R20 million for the next financial year."
Mayende says Sekunjalo is following an aggressive growth strategy and recent acquisitions show that the group has "entered an exciting new phase of earnings growth".
He adds that if the group were to be unbundled and sell its portfolio of investments, it would be able to realise a potential value of R2 to R2.50 a share, or between R500 million and R700 million, which indicates that Sekunjalo is trading at a substantial discount to its unbundling value.
The share was trading at 71c on the JSE by midmorning today, unchanged from yesterday's close.
Share