AltX-listed Africa Cellular Towers (ACTowers) has agreed to pay R45.8 million in a mix of cash and shares for cellphone tower manufacturer JK Shelters.
In an announcement to shareholders, the company says it has secured written employment contracts from key management of JK Shelters, as well as confidentiality and restraint agreements from key management and vendors.
The company explains the purchase price had been based on JK Shelters delivering after tax profits of R9 million for the year ended 28 February.
When ACTowers first advised the market it was seeking to acquire the manufacturer, it said the indicative purchase consideration was R40 million. At the time, the acquisition was conditional on JK Shelters achieving after tax profits of R8 million for the year ended 28 February.
Following the completion of the acquisition, ACTowers says it expects earnings per share (EPS) and headline EPS to rise by approximately 13%, to 18.4c and 18.2c, respectively.
ACTowers has agreed to settle the cost of the acquisition through a cash payment of R13.75 million and the allotment of 23 million shares at an issue price of R1.35 per share.
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