Altron completes Bytes UK demerger
Altron shareholders will receive about £542m (R10.9bn) in the form of Bytes ordinary shares and cash
Technology group Altron has completed the listing of its now former subsidiary Bytes UK on the London Stock Exchange (LSE).
Altron announced in April that it would spin off Bytes, which provides software, cybersecurity and cloud services. The decision followed a review of its portfolio, which showed that Bytes’s value wasn’t reflected in the Altron group’s share price, while its growth path was different to that of the rest of the business.
Through the listing, the group has achieved a price of £2.70 (R54) per ordinary share of Bytes, resulting in a market capitalisation of approximately £647m (about R13bn) on admission to the LSE.
Back in November, Altron's management had put a minimum listing value of £450m (about R9.4bn) at £1.89 per share on the UK business. The group had been willing to call off the listing if it didn't achieve the price target.
Bytes UK, the biggest reseller of tech giant Microsoft’s products in Britain, which has been renamed Bytes Technology Group Plc, will have a primary listing on the LSE and a secondary, inward listing on the JSE. As with Naspers’s unbundling of MultiChoice in 2019, Altron will not retain any shareholding in the UK business. All of Bytes UK’s shares will be distributed to shareholders.
Altron shareholders will receive — after tax and transaction costs — approximately £542m (about R10.9bn) in the form of Bytes ordinary shares and cash.
With the Bytes demerger now complete, Altron “will continue to focus on its remaining businesses and drive the growth strategy it has communicated to the market. Altron 2.0 is a R7bn revenue business with a strong balance sheet and exciting prospects as it continues to leverage the growing need for digital transformation and data,” the company said.
In a statement, Mteto Nyati, CEO of Altron, said: “With our 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, we look forward to delivering strong earnings growth over the next five years. 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,” he said.
With Bytes UK now out of the fold, Altron is currently valued at R4.06bn. Shares in the technology group were trading 4.29% firmer at R10.20 during lunchtime trade on Thursday.
Bytes is currently trading at R67.40 a share on the JSE.
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