| Thu 8 Jul 2004, 8:59 | | Bytes' plan to buy CS unchanged by probe |
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Bytes` plan to buy CS unchanged by probe
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Markets Correspondent
BYTES Technology Group`s decision to acquire technology company CS Holdings will not be affected by the Financial Services Board`s (FSB`s) investigation of the company for alleged insider trading, CEO Dave Redshaw said yesterday.
`We are continuing with our due diligence on the company. We are still in discussion with them, and the probe by the FSB will not affect our view on the company,` Redshaw said .
Bytes is the fourth group to show an interest in acquiring CS Holdings , and a takeover would end months of speculation about the fate of the company. Three potential suitors, Reunert, Enterprise Outsourcing Holdings and UCS, looked earlier at acquiring the group but all decided not to bid.
Bytes` operations span office automation, networking, storage, software development and communications.
The FSB said on Tuesday it was investigating CS Holdings for alleged insider trading, and would make further announcements after the probe was completed.
Gerhard van Deventer, insider trading executive director at the FSB, said earlier this week the board was not investigating the company or how it operated.
`The investigation is into the transactions of the company`s shares, and not the company itself,` he said.
Peter Redman, of the JSE Securities Exchange SA`s (JSE`s) surveillance team, said the bourse picked up on the issue after CS Holdings issued a profit warning on April 28 this year. Annette van der Laan, former CEO of CS Holdings, who sold a number of her shares in the company before the trading update, was investigated by majority shareholder Reunert.
Van der Laan resigned in the wake of the investigation , and the damage to CS Holdings led to a slump in the companies share price, which almost halved.
The FSB said it was investigating certain transactions of the company`s shares during the first half of 2004, leading up to the company`s April statement.
The FSB is expected to announce its findings soon.
Johan Goosen, CS Holdings` company secretary, said the company first heard about the matter through the media on Tuesday, and had not been contacted, by the JSE or the FSB.
The company`s shares fell 5c to 20c yesterday, after dipping to an all-time low of 18c a share last week. They have lost 70% of their value this year.
Jul 08 2004 08:12:39:000AM Ayanda Shezi Business Day 2nd Edition
