Spescom starts changes at Altris

By Phillip de Wet for Spescom

Johannesburg, 02 Aug 2001

JSE-listed Spescom this week announced that it would rename its US subsidiary Altris to Spescom Software with effect from October.

The change, said to be necessary for the company to reflect a single corporate brand as it globalises, is to be the first of many small, but telling, changes planned over the next six months.

Spescom obtained its initial 17% stake in Altris US in 1999, when it acquired a controlling stake in the Altris UK business. At the time, Altris US was embroiled in accusations of falsifying financial statements and faced a lawsuit from shareholders, and the company was desperate to find a buyer.

Last year, Spescom took control of the US company, with the stated intention of reviving the Nasdaq listing suspended due to the shareholder action. At the time, Spescom chairman Tony Farah believed that Altris could reach a market capitalisation of $100 million.

The total investment Spescom has made is less than R10 million.

In July, Spescom announced it would replace Roger Erickson, the CEO who had seen Altris through the settlement of the legal action against it, with Bill Weber, former GM for Cisco Systems' Sub-Saharan Africa region. But Weber's appointment was retracted after what Spescom describes as his attempts to change the terms of his employment contract after accepting the position.

As an interim move, Spescom appointed Carl Mostert, COO of the local eBusiness Solutions Group, in the position.

Mostert has spent 18 years with Spescom and has been involved with Altris since Spescom first took a stake in the business. "Perhaps not in all the gory details of the operational issues, but definitely strategically," he says.

Mostert, who will move to the US this month to take up the position, says he expects to spend at least six months at the company. In that time he wants to implement "some small changes" and identify a successor. This may take longer than six months, as he promises the next appointment will be conducted "in a slower manner", to guard against further mistakes.

Mostert says Spescom is still well below the 50% of its earnings it means to derive from offshore business and Altris is to be beefed up to help deliver increased offshore earnings.

"There will be no major changes, but we will focus on concentrating the business on vertical market applications based on where we have had traditional relationships," he says. "We will exploit the available opportunities. We have limited resources, and we need to marshal our troops."

Areas such as the electricity utility and transport industries are to be targeted.

As for the Nasdaq listing, Mostert says the intention remains to list the business again, either there or elsewhere, but that the timing would depend on when a market recovery takes place. "We need to both unlock value and get access to capital," he says. "We have plans for considerable growth to penetrate our markets a lot more significantly, which would require working capital."

Shares in the company are currently trading over the counter on a bulletin board.