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AYO Technology Solutions Limited - Voluntary Announcement

Published Apr 23, 2018


CAPE TOWN - AYO Technology Solutions Limited has noted with dismay and serious concern, the media articles that have been published about our company over the past weekend. 

In particular, we are deeply troubled by the defamatory, false and inaccurate information that was published by amaBhungane in “Surve’s Listing Ship” on 21 April 2018 (the “article”) and then republished by several other media houses, including Business Day - without any opportunity for AYO to respond. 

In order to inform all stakeholders of the correct factual situation simultaneously, AYO has decided to publish this announcement on SENS as we are in a closed period and this information has significantly impacted our share price . This announcement serves to correct the inaccuracies contained in the article and to reassure all our stakeholders (especially shareholders and customers) that AYO is a proudly black-owned South African ICT company and our dealings with the market have at all times been, and will continue to be, transparent and driven with the highest level of sincerity and integrity. 

The following points are critical in correcting the misleading tone of the article:

- AYO listed on 21 December 2017 and not on 8 January 2018.

- AYO’s private placement was oversubscribed by R1 billion. The company elected not to take the rest of the commitments as our acquisition strategy did not require these funds. The suggestion that “no one else but the PIC bought these shares” is therefore grossly misleading.

- The share allocations took cognisance of the need to enhance or at least maintain, AYO’s black empowerment credentials, which is crucial in terms of AYO’s market positioning against its competitors.

- The  pre-listing statement ((“PLS”) ) issued for the listing complied with the JSE Listings Requirements and the listing received all requisite regulatory approval.

- AYO has had no relationship with Sagarmatha Technologies. Pointing out a common indirect shareholder is only useful to paint a particular narrative, which is mischievous in the extreme.

- AYO did not need to be “propped up with R4.3 billion”.  It is a substantive and profitable business, with significant contracts and market share.  It is a credible company with a track record of nearly 20 years in the market place.   

- To limit AYO’s “main rationalization for the private placement” as being the British Telecoms SA (“BTSA”) transaction is factually incorrect. AYO had detailed a list of acquisitions that it intends on concluding, including the BTSA transaction. Details of all transactions will be announced in accordance with the JSE Listings Requirements. Accordingly, this accusation is a gross misrepresentation of the rationale for our listing and our raison d'etre as a black-owned company. 

- AYO has been fully and consistently transparent in all its dealings, including the contents of our PLS with regards to our plans post listing. Our dealings with the PIC have been equally transparent. We have followed all PIC processes to attract its investment in our company.

- With regards the trading of our shares, the article alleges that the “only major movement” of our share price since the listing led to a price drop of 43% from 1 139 shares on 26 February 2018. Firstly, the drop on that day was 39%. Secondly, the share price recovered by 39% on the very next day. Thirdly, a nature of this drop is quite obviously due to a lack of liquidity in the share and any suggestion that a one-day drop is evidence of an “unrealistic valuation” would be factually contradicted by the fact that in excess of 97 065 shares have traded post 26th of February 2018, with an average closing price of approximately R40 per share. 

- Mr Sole has wrongfully created the impression that Sekunjalo and Dr. Survé are shareholders in AYO.  Neither Dr. Survé nor Sekunjalo are shareholders in AYO. 

- Dr. Survé is also not a member of the management team or the board of AYO.  

- No existing shareholders sold any shares on the market or bought any when AYO listed.  Additional shares were made available for subscription.

- Mr Sole by his misleading article, impugns the integrity of the experienced and professional people who drive the company, many of whom have decades of experience in the ICT sector and of leading publically traded organisations.

- It is important to note that AYO has been listed for a period of less than six months – to judge the achievement of the objectives set out in its PLS and its financial performance in this period is not reasonable, nor is it appropriate to suddenly raise these issues four months post the listing when this was always publicly available information and on the eve of our half year results.

AYO remains committed to transforming an industry that is in dire need of transformation and is determined to make a real difference in the sector and to meet the objectives as set out in our PLS. Unfortunately, the recent media inaccuracies only delay these plans.

We call upon the media to be fair in their reporting with regards to AYO, our listing and our value proposition to the market. This factually incorrect article has already been incredibly damaging for our shareholders, customers and the many men and women who work at AYO and our subsidiaries. 

AYO reserves its rights to address the unsubstantiated allegations in due course.

AYO will not react to any further media coverage, unless absolutely required.

On behalf of the board.


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