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Management Networx (Proprietary) Limited ("Sm Networx")
DATACENTRIX HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/006413/06)
Share code : DCT
ISIN code : ZAE000016051
("Datacentrix" or "the company")
ACQUISITION OF THE BUSINESS OF SOLUTION MANAGEMENT NETWORX (PROPRIETARY)
LIMITED ("SM NETWORX")
1. Introduction
Barnard Jacobs Mellet Corporate Finance (Proprietary) Limited is
authorised to announce that an agreement has been signed whereby
Datacentrix has acquired, subject to the fulfilment of the suspensive
conditions set out in paragraph 5 below, the business of SM Networx, as
a going concern ("the acquisition"). In terms of the agreement,
Datacentrix will retain the skills and services of Ronelle Baker, Penny
Lansdell, Jan van der Mescht, Anne Benatar and Rory Hamilton, the
vendors of SM Networx ("the vendors").
2. Rationale
The board of directors of Datacentrix are of the opinion that the
acquisition is in the best interest of shareholders as:
SM Networx, an organisation of forty skilled people, is active in
the IT infrastructure and services arena and its business is
complementary to that of Datacentrix;
the acquisition enables Datacentrix to increase its footprint and
prominence in the Johannesburg area, an area the company
identified as a target for growth; and
Datacentrix will expand its current enterprise customer base by
gaining access to the existing corporate client base of SM
Networx.
3. Purchase consideration
The total purchase consideration is a maximum of R33 222 667, which is
payable as follows:
- R20 000 000 in cash; and
- R13 222 667 in Datacentrix shares.
The purchase consideration will be settled in three annual instalments,
subject to the achievement of certain profit targets by SM Networx up
to 28 February 2004.
The Datacentrix shares will be issued at an issue price of 100 cents
per share.
4. Effective date
The effective date of the acquisition is 1 March 2002.
5. Suspensive conditions
The disposal is conditional upon, inter alia:
- the vendors entering into employment contracts (with a minimum
term of three years) with Datacentrix;
- the completion of a due diligence investigation of the operations
and financial position of SM Networx by Datacentrix;
- the approval of the acquisition by the board of directors of
Datacentrix; and
- any necessary regulatory approvals.
6. Financial effects
The table below sets out the pro forma financial effects of the
acquisition:
Before After Change
(cents) (cents)
Earnings per share 13.5 15.5 15%
Headline earnings per share 16.7 18.4 10%
Weighted average number of 165 341 178 564
shares in issue (`000)
Net asset value per share 63.8 66.2 4%
Tangible net asset value per 54.9 44.8 (18%)
share
Number of shares in issue 187 008 200 231
(`000)
Notes to the above calculations:
- The financial effects referred to above have been based on audited
results of Datacentrix for the year ended 28 February 2002 and the
unaudited results of SM Networx for the year ended 28 February 2002.
- The financial effects referred to above have been calculated based on
the assumption that the full acquisition price (maximum cash and
shares) was paid during the year ended 28 February 2002. The actual
price will be paid based on the attainment of future profit warranties
by SM Networx up to 28 February 2004 and is payable over three years.
- Net asset value and tangible net asset value per share have been
calculated assuming the acquisition took place on 28 February 2002.
Again the maximum possible amount of shares to be issued was used in
this calculation, even though these shares might only be issued over
the next three financial years dependent on the attainment of future
profit warranties. Therefore, the dilution in tangible net asset value
per share is unlikely to be realised.
Pretoria
2 May 2002
Sponsor
Barnard Jacobs Mellet
Corporate Finance
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