DURBAN – Investment holding company AfroCentric Investment Corporation slid by more than 14 percent on the JSE yesterday after the group announced that it would acquire the remaining 74 percent stake in Activo.
AfroCentric would acquire the stake through its subsidiary ACT Healthcare Assets from WAD Holdings and Activo founders SE Claassen and JPF Martin for an aggregate purchase consideration of R588 million. AfroCentric said an independent valuation of 100 percent of Activo was commissioned to determine the option price range, which was determined according to the formula of the original purchase agreement concluded in 2014.
The Activo acquisition would be settled through a combination of cash and the issue of AfroCentric ordinary shares. “Shareholders will be aware that AfroCentric acquired a 26 percent interest in Activo and a call option for a further 74 percent interest in Activo as a component of the acquisition of the WAD assets in 2015,” the group said in a statement.
The AfroCentric share price dropped to R4.70 yesterday morning after the group announced the deal. The price closed at R5.45 on the JSE at the end of the day.
AfroCentric is invested in a number of healthcare services segments in both the public and private healthcare markets in South Africa, with expanding operations and related applications in wholesale pharmaceutical supply, national chronic medication distribution and disease management. Medical scheme company Medscheme is a subsidiary of AfroCentric.
WAD owns a 51.6 percent stake in Activo and will be paid R409.62 million while Martin and Claassen, who own 11.2 percent each, will be paid R89.19m each. The effective date of the acquisition will be January 1, 2019.