Altron jumps 5% on JSE after completion of Bytes demerger
DURBAN - Allied Electronics Corporation (Altron) share price rose by more than 5 percent on the JSE on Thursday after the information technology group announced that it has completed the demerger and listing of Bytes Technology Group plc (Bytes).
Bytes has a primary listing on the London Stock Exchange and a secondary listing on the JSE and it achieved a price of £2.70 per Bytes ordinary share on listing, with a market capitalisation of approximately £647 million (R13 billion).
Altron said in April that the rationale behind the demerger was that Bytes’ value was not reflected in Altron’s share price and its growth path was different from the rest of the group.
Altron chief executive Mteto Nyati said they are looking forward to delivering strong earnings growth in the next five years, with their purpose of delivering innovation that matters, and a set of highly differentiated technology solutions, including telematics, health and financial services platforms, cloud services, data analytics, artificial intelligence and various security offerings.
“In addition, we will continue to look for opportunities to further unlock value for our shareholders. We also wish our colleagues and friends at Bytes luck for the future and are really looking forward to seeing all they will achieve,” Nyati said.
Bytes achieved a price of £2.70 per Bytes ordinary share and the issue price was in the top half of the previously communicated price range of £2.40 to £2.90 per Bytes ordinary share.
The group said approximately 40 percent of the Bytes ordinary shares are distributed to existing Altron shareholders and the remaining shares are held by investors located outside South Africa and Bytes management.
Bytes, established in 1982, is a leading provider of IT solutions and its growing portfolio of services includes cloud, security, licensing, SAM, storage, virtualisation and managed services.
Altron said as a result of the demerger of Bytes, Altron shareholders will receive, after tax and transaction costs, a consideration of approximately £542m in the form of Bytes ordinary shares and cash.
Altron said the demerger of Bytes topped a multi-year turnaround for it where management has consistently delivered on what it has promised to shareholders.
“Through this demerger Altron has demonstrated its ability to create significant value for shareholders with the execution of this highly complex transaction,” the group said.
Altron chairman Mike Leeming said they are very proud of this attractive outcome for Altron shareholders.
“I would like to thank the Altron board for supporting this transaction from the beginning and in particular Value Capital Partners for initiating this process of significant value unlock. Lastly the execution of this highly complex, multi-jurisdictional transaction would not have been possible without the support and hard work of the senior Altron management team and the various transaction advisors across both South Africa and the UK,” Leeming said.