The Competition Commission has cleared the way for the finalisation of Kelly Group's acquisition of black-owned ICT skills development and training solutions group Torque IT, for an amount “not exceeding R37.85 million”.
In a SENS announcement last night, JSE-listed Kelly states: “...shareholders of the company are advised that all conditions precedent relating to the acquisition of Torque IT by the Kelly Group have now been fulfilled. The acquisition will be implemented with an effective date of 2 October 2008.”
As a result, Torque IT CEO Mthunzi Mdwaba has been appointed deputy chief executive of the Kelly Group and will join its board as an executive director with effect from 2 October.
“Mdwaba, who obtained a BA LLB at the University of the Witwatersrand, led Torque IT to a number of international and local awards and was IT personality of the year 2004/5. He is one of the vice presidents of Business Unity South Africa and is the outgoing chairman of its transformation policy committee,” Kelly says in a statement to shareholders.
“Mdwaba is also the national chairman of the Black Information Technology Forum (BITF) and holds a number of other directorships and trusteeships.”
When the deal was announce, in mid-August, Kelly Group CE Grenville Wilson said the group had identified the ICT sector as a target market and the acquisition of Torque IT would support its growth objectives in this sector.
“Skills development is an immediate adjacent to recruitment and placement. We realised that we are weak in the area of IT and Torque IT, in terms of its organisation and culture, is a great fit for us.”
The acquisition consideration will be calculated in accordance with a formula based on the audited financial statements of Torque IT, for the 12 months ending 30 November 2008.
The acquisition consideration is subject to an adjustment based on Torque IT achieving free cash flow warranties for the years 2008, 2009 and 2010, provided that the total consideration payable by the Kelly Group in relation to the acquisition shall not exceed R37.85 million. The acquisition consideration shall be discharged in tranches, in a combination of cash and shares.
Share