Buy-back means CCN may have to quit JSE after all
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Information Technology Editor
JUST a month after reaffirming its commitment to remaining a publicly traded company, call centre operator CCN Holdings has done a U-turn and announced that it may quit the JSE Securities Exchange SA after all.
The company is offering to buy back its shares from minority investors at 85c each, a 13,3% premium to the 75c at which they have traded recently.
As CCN already falls short of the JSE's requirements that 20% of its shares be in public hands, the buy-back may see that level fall considerably lower.
In that case the JSE will review CCN's shareholder spread, and may decide it can no longer remain a listed entity.
The final decision will be known only after the buy-back offer closes . As CCN has about 54million shares in issue, of which 9-million are public , the move could cost about R7,6m if its minority investors chose to leave.
A month ago CCN CEO Lawrence Brick announced plans to buy back 18,2-million shares held by Giant Trading and Arbores, at 85c each, or a total of R15,4m. At the time Brick said the cancellation of those shares would still leave CCN underrepresented in terms of free float, but CCN would work to put more shares on the open market .
Now, however, the directors have decided it is only fair to make the same voluntary offer to acquire all or a part of the shares held by minority investors.
Shareholders may have suspected that a buy-back was due as CCN shares had traded at 66c before the Arbores and Giant Trading buy-back was announced. That makes the offer of 85c a share a 28,8% premium to its value of just a month ago.
CCN Holdings originally listed as the internet service provider NetActive , but sold its core operations last year.
So far CCN has not made a great success of its new business, as its results for the year to this April showed its remaining operations had suffered a loss of R4,8m. Its interim results to October will also show an after-tax loss, but a loss that should have reduced substantially.
Nov 04 2003 07:31:16:000AM Lesley Stones Business Day 1st
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