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Foneworx changes strategy, shareholding

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FoneWorx has received a sufficient number of irrevocable undertakings from the company’s shareholders to proceed with the proposed purchase of the IDC’s stake and the subsequent sale of those shares to a consortium of the Kirsh Family trusts.

The shares will be priced at 130.81 cents per share for both the purchase from the IDC and sale to the Kirsh Family trusts.

FoneWorx has obtained written irrevocable undertakings from shareholders holding in aggregate 71 762 967 FoneWorx ordinary shares, being 52.8% of the issued shares in the Company. Given that the IDC and the Kirsh Family Trusts are precluded from voting on the Transactions at the general meeting, the irrevocable undertakings effectively comprise 78.5% of the issued shares in the company.

FoneWorx CEO Mark Smith says: “Our shareholders have given us a very strong mandate to proceed with the Kirsh Family and pursue further collaboration with them. We are pleased that we have been able to replace IDC, who have been supportive shareholders, with Issie and William Kirsh who the company can look to unlock further value in FoneWorx and pursue a new growth strategy.”

William Kirsh comments: “My dad and I are delighted to become strategic shareholders in FoneWorx and are very privileged that the CEO and directors chose us as their strategic partners. It is a company that is exceptionally well managed and continues to innovate. The company has grown its turnover and earnings over the last six years by 50% and 22% compound, respectively. It has a sound business model which is highly cash generative with a very strong balance sheet of approximately R100-million in cash. We look forward to building shareholder value with the existing management and directorate.”

The circular containing full details of the transactions is expected to be distributed on or about 14 August 2012.

Shareholders are advised to exercise caution when dealing in the company’s securities due to the on-going negotiations between FoneWorx and the Kirsh family regarding the new envisioned strategic direction for the company.