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Datatec mulls Westcon-Comstor stake sale

Technology

 Johannesburg – Datatec, an international ICT solutions and services group operating in more than 60 countries, says it may sell a major share in Westcon-Comstor’s operations for $800 million.

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Datatec CEO Jens Montanana. Photo: Leon Nicholas

The dual-listed company says, in a statement published on Friday, the deal is subject to customary clearances, and there is no doubt it will be finalised.

“There can be no certainty that the transaction will be completed, nor as to the precise terms on which the transaction might be completed. Shareholders are therefore advised to continue to exercise caution when dealing in the company’s securities.

“The company undertakes to announce further details of the potential transaction as soon as practicable.”

In addition, Datatec said underlying earnings per share, headline earnings per share and earnings per share are expected to be more than 50 percent lower year-on-year in the year to February.

This, it says, translates to underlying earnings per share – its key measure of profitability – being at least 16 US cents lower.

Headline earnings per share last year came in at 19.4 US cents, while earnings per share were 19.3 US cents.

Read also: Growing Datatec acquires four firms

The year over year expected decline in earnings is as a result of a worse than expected result in Westcon-Comstor, it says.

There was a decline in fourth quarter financial performance in the Europe Middle East and Africa region, it explains.

Long its largest unit, Westcon-Comstor experienced disruption to the business as a result of final stages of SAP implementation in EMEA. It says Westcon-Comstor has made adjustments to the operating model and Datatec expects this to support a rapid recovery.

Logicalis trading was in line with management’s expectation.

BUSINESS REPORT ONLINE

 

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