Johannesburg, 08 Sep 2010
Listed computer distributor Mustek wants more details on Datatec's bid to buy out its subsidiary, Comztek, before agreeing to sell its stake.
Last week, London- and Johannesburg-listed Datatec said it was in talks to buy Comztek for R97 million in cash and shares. So far, all of Comztek's management and shareholders, apart from Mustek, have indicated they would support the deal.
Mustek, a hardware distributor, owns close to 42% of Comztek, and Datatec has given the distributor until the end of the month to accept the offer.
Mustek CEO and co-founder David Kan says the company had not signed the letter of intent to sell by the time Datatec made its announcement. He explains that the deal has too many conditions attached to it.
Datatec told the market that the offer was “conditional upon the satisfactory completion of due diligence and of various regulatory approval processes required for a transaction of this nature”.
Kan says Mustek wants the offer to be made unconditional before it agrees to sell. He explains that Datatec needs to do due diligence on the company before the conditions, which Datatec did not spell out in its announcement, can be removed.
Mustek has not fully consolidated Comztek into its operations, after buying the 42% stake in 1999. Kan says Mustek has a pre-emptive right to buy out the balance of the subsidiary it does not own.
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