JSE-listed IT solutions company Global Technology (Glotec) has acquired a controlling stake in Solace Australia for R6 million.
The acquisition, which is a joint venture with Temenos Holdings, "is part of a strategy to establish Globus as the premier banking solution worldwide for all sizes of banking concerns", says Glotec CEO Ray Leonard.
Melbourne-based Solace develops and markets computer software systems to meet the specific demands of mid-range financial institutions such as building societies, credit unions and banks.
Last month, Glotec, which provides IT solutions to the banking, insurance and financial services sectors, acquired DBS Consult, local distributor of Solace products.
Solace`s shares were recently suspended and the company was placed under administration as it was unable to raise the capital to develop its retail banking product further.
"The company has emerged from this difficult period in a profitable situation, from which we will grow the company," says Leonard. "Solace is poised to be re-listed on the Australian Stock Exchange by December."
Robert Edge, the Australian administrator appointed to Solace Australia, agrees.
"After a successful administration period during which the company`s position was consolidated and decisive action was taken, Solace Australia is now profitable," says Edge.
"It is my belief that Solace Australia has found the right strategic fit in Global Technology."
Edge adds that Glotec has talked directly to Solace shareholders, who have voted in favour of the deal.
The company will continue to trade under the name Solace Australia and Glotec says all key members of staff will be retained.
In terms of the agreement, Glotec is to subscribe for 4 million convertible notes issued by Solace at a subscription price of A$800 000. It is also to purchase all convertible notes, debentures and options held by Greenchip & Trust Company for A$525 000.
In addition, Greenchip & Trust Company has been afforded put options to subscribe on or before 31 March for about 1.13 million options for A$226 122.
Glotec is also to grant put options to all investors holding put options over unissued shares in Solace at a strike price of A$0.20 per option.
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