Khalid Abdulla. Picture: FINANCIAL MAIL
Khalid Abdulla. Picture: FINANCIAL MAIL

African Equity Empowerment Investments (AEEI), which listed Premier Fishing and Brands in March, is hoping to raise a truckload of new capital by floating its acquisitive technology army on the JSE.

On Friday the AEEI board approved plans for private placement of R3.7bn to R5.7bn for Ayo Technology.

Ayo offers an array of services in the information technology and telecommunication sector as well as a 30% stake in British Telecoms SA (BTSA). Ayo holds a 25% market share of the public hospital sector and boasts blue-chip clients like Nokia, Siemens, Cisco and Microsoft.

The size of the envisaged private placement is likely to raise eyebrows as Ayo was valued at about R3bn in the group’s recent year to end-August results.

THE SIZE OF THE ENVISAGED PRIVATE PLACEMENT IS LIKELY TO RAISE EYEBROWS AS AYO WAS VALUED AT ABOUT R3BN.

A market watcher suggested that Ayo should probably have tested the investment community’s appetite before embarking on such an ambitious capital-raising exercise.

The proposed fund-raising exercise should reduce AEEI’s holding in Ayo from about 80% to about 49%.

A circular to shareholders said Ayo was well positioned for growth over the next three to five years, both organically and through a combination of acquisitions, partnerships and sourcing innovative technologies.

BTSA is a key component of Ayo in terms of value and profitability. But confidentiality agreements have precluded full disclosures on financial performance aside from reference to annual dividends. AEEI acquired the stake in 2009 for R27m.

The circular makes scant mention of BTSA, but CEO Khalid Abdulla said extensive detail would be available in Ayo’s prospectus.

hasenfussm@fm.co.za

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