Powertech To Acquire Five IST Units For R505m
Altron subsidiary in move to complement marketing and manufacturing business Powertech to acquire five IST units for R505m
Powertech would buy five units of Pretoria-based technology group IST for R505 million, said Norbert Claussen, chief executive of the wholly owned subsidiary of listed electronics and technology company Altron.
The acquisition excludes IST's defence and nuclear units. IST's nuclear division has been heavily involved in the planned multibillion-rand pebble bed modular reactor.
The five divisions that will be acquired by Powertech are Energy, Otokon, Data, Telecom and Industrial. They have a combined turnover of about R500 million a year and employ about 300 people, most of whom are engineers.
The transaction - which is still subject to certain conditions, including the approval of the competition authorities - is expected to enhance earnings at both Altron and Powertech levels.
Claussen said on Friday that the acquisition was in line with the company's strategy to create a significant service business to complement its marketing and manufacturing businesses.
"The acquisition of IST enables us to offer a complete package to our customers in our chosen markets," he said. "This is of particular importance in the buoyant infrastructure, building and construction sectors. The acquisition ... enhances Powertech's human capital capacity and skills base."
Powertech will continue to manage the IST business as an autonomous operation alongside its cables, transformers, batteries and industrial units. IST delisted from the JSE in 2004 and is owned by management and Ethos Private Equity.
Harry Coetzee, IST's chief executive, said Powertech's credentials in black economic empowerment would significantly enhance the outlook for IST. Coetzee, who will join Powertech's executive committee and the board, said they expected the company to expand IST's opportunities and allow it to benefit from being part of a bigger group.
IST's financial director, Etienne Toerien; its electronics group executive director, Hannes Visagie; and the divisional heads of the five operations acquired by Powertech will all be joining Powertech.
Coetzee said one of the requirements of Ethos in the transaction was that he would remain on the board of both operations for the next 12 months to ensure a smooth transition.