Ayo Technologies: The numbers don’t add up
There is a complete mismatch between the tech firm’s valuation and the value of its parent company’s share price
The market will be scratching for an appropriate value for Ayo Technology Solutions after the recently listed counter announced a services contract with energy giant Sasol this week. Ayo was spun out of African Equity Empowerment Investments (AEEI) and listed on the JSE late last year following a private placement that raised more than R4bn in fresh capital. The initial market capitalisation for Ayo was almost R15bn. But this value has crumbled to less than R10bn, with recent interim results not dispelling market contentions that the prelisting share placement — which was supported by the Public Investment Corp — was optimistically pitched. The announcement of the Sasol deal was short on detail: the official press release says Ayo will deliver and manage a set of global network, communications and security services. The FM understands the deal could be worth R2bn. The prevailing market value of Ayo, a highly illiquid stock, remains contentious. Based on the share price at the time o...
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