| Wed 7 Jul 2004, 15:38 | | ACQUISITION ANNOUNCEMENT |
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SQUARE ONE SOLUTIONS GROUP LIMITED - ACQUISITION ANNOUNCEMENT
SQUARE ONE SOLUTIONS GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1999/026822/06)
Share code: SQE ISIN: ZAE000023768
(`Square One`)
ACQUISITION ANNOUNCEMENT
1. Introduction
Further to the cautionary announcement dated 17 May 2004, shareholders are
advised that Square One has entered into an agreement, dated 30 June 2004,
with Square One (Pty) Limited (`the company` or `Latitude`), a company
completely unrelated to Square One, and Corvest 4 (Pty) Limited, Equicap
(Pty) Limited and the employees and management of the business carried on
by the company (`the sellers`) for the acquisition of the company (`the
acquisition`) with effect from 1 June 2004 (`the effective date`).
2. The acquisition
Latitude`s business consists of a team of dedicated IT professionals who
specialise in IT infrastructure services, incorporating platform
migrations, server consolidations, data centre operations, desktop
deployment, security, enterprise directory services, messaging and
collaboration, patch management, enterprise portals, enterprise networking,
mobile solutions, application platforms, service provider/telco services,
project management services, infrastructure architectural services and
service management.
The consideration payable by Square One to the sellers for the acquisition
is an amount of R1 640 500 (`the acquisition consideration`), which will
be settled by the issue of 1 640 500 new Square One ordinary shares. The
acquisition consideration is payable by Square One to the sellers after
Square One has obtained approvals from the JSE Securities Exchange South
Africa, the Securities Regulation Panel and the Competition Commission, if
required. Should the company`s profit before interest and taxation for the
year ended 31 December 2004 exceed R2 500 000, a maximum additional
purchase price of R1 314 500, to be settled by the issue of a maximum of 1
314 500 new Square One ordinary shares, will be paid by Square One to the
sellers on a pro rata basis.
3. Rationale for the acquisition
Square One has in the last two years been expanding its offering to
incorporate vertical and horizontal IT solution offerings to its customers.
The acquisition is an important step for Square One in this regard. The
acquisition provides Square One with additional skilled professionals in,
inter alia, the following areas of business: architecture, integration and
delivery of IT infrastructure solutions and the implementation thereof,
either on a primary or secondary contractor basis.
The expanded group adds additional value to customers, and across all the
operations Latitude is entirely complementary to Square One. Latitude
consists of a team of highly qualified IT professionals, considered to be
amongst the best and most experienced in the country, who understand the
importance of aligning and integrating technology and infrastructure with
the IT and business strategy of their clients. The company`s outstanding
track record of successful solution delivery has largely been based on the
application of proven methodologies and best practices over many years.
This is in line with Square One`s strategy.
4. Financial effects of the acquisition
The pro forma financial effects of the acquisition on Square One`s
earnings, headline earnings, net asset value and net tangible asset value
per share are not significant.
Johannesburg
7 July 2004
Sponsor
BRIDGE CAPITAL
Corporate advisor
UTHO CAPITAL (Pty) Ltd
Date: 07/07/2004 03:32:03 PM Produced by the JSE SENS Department
