Analysts cautious as EOH share rallies 55%
Firm to consolidate 200 businesses into three divisions
Technology services group EOH’s share price jumped as much as 55% on Tuesday, the best level in six weeks, after it said it would raise R1bn through asset sales to reduce debt. As the market cheered, analysts cautioned that they would be watching the scandal-tainted company’s ability to grow and execute a turnaround plan. The company, once a titan in SA’s information and communications technology (ICT) sector, has been plagued by concern about governance and allegations of corruption in recent years. Under new CEO Stephen van Coller, it has been looking into past bids for government contracts, one of which was said to have cost the company its partnership with Microsoft. Mark du Toit, investment manager at Courtney Capital, said: "What they [EOH] are going to need to demonstrate is that the business can grow organically without acquisitions. "The big test is whether the businesses they have and hold on to can generate growth," he said. The company plans to consolidate its more than ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.