subscribe: Daily Newsletter

 

UCS buys Computer Software Consultants

0 comments

UCS Group (UCS) has announced the acquisition of the business of Computer
Software Consultants (CSC) by wholly owned subsidiary Destiny Electronic
Commerce (Destiny) as a going concern with effect from 1 June 2008, subject
to conditions precedent.

The initial purchase consideration of R67.605-million will be settled
through the subscription of ordinary shares in Destiny by UCS and CSC
management for R10.605-million, a loan to Destiny from UCS for R4-million
and the balance of R53-million through third party debt financing.
UCS through wholly owned subsidiary Computerkit will subscribe for 70% of
the Destiny ordinary shares and CSC management for 30%, financed through
loans provided to management by UCS at current commercial rates.
The initial purchase consideration may increase in terms of profitability
targets set for CSC to achieve in the 2009 and 2010 financial years. The
total purchase consideration is however capped at R98.1-million.
John Bright CEO of UCS Group commentes: "In 2007 we announced our intention
to set-up a value added services division as part of our strategic
objectives. The CSC transaction represents the foundation of the value added
services division and the commencement of a specific focus on servicing a
portion of the financial services sector to complement and assist in
diversifying our current software, solutions and services offerings to the
retail and government sector.
"The CSC business enhances UCS's ability to provide its customer base
(retailers, government and banks), post the acquisition, with seamless
point-of-sale and payment solutions together with other integrated value
added services.
"CSC management will continue to be responsible for the day to day running
of the business, bringing with them invaluable experience, relationships and
expertise which will most certainly impact positively on the UCS Group and
its value added services strategy into the future."
The CSC business and the Destiny switching business will operate alongside
one another as separate divisions within Destiny.
The final remaining condition precedent is the preparation by CSC of an
effective date balance sheet and related schedules agreed to by the parties.