Datatec’s subsidiary Logicalis Group and its partner in Latin America, Promon SA, have agreed changes to their ownership of Promon Logicalis Latin America Limited (PLLAL) that will result in Promon continuing as a long-term partner of Datatec in Latin America.
Promon is a large privately-held technology, engineering and investment group that was formed in 1960 and which has regional business interests. It has been an excellent partner for Logicalis and has assisted in the growth of PLLAL operations in multiple countries in Latin America since 2008.
Promon currently owns 30% of PPLAL and has a put option on this interest to Logicalis.
Promon has now purchased an additional 10% of PLLAL from Logicalis for $15-million in cash, increasing its share of the business to 40%. As a result Datatec’s equity ownership of PLLAL through Logicalis will reduce to 60%, with effect from 31 August 2011.
At the same time, Promon has agreed to cancel its put option on its shareholding in PLLAL.
In accordance with IFRS, the fair value adjustments to this put option liability have been accounted for by Datatec through its income statement in previous reporting periods.
Jens Montanana, Datatec CEO, comments: “Since Logicalis first partnered with Promon in May 2008 and formed PLLAL to develop its existing Latin American business, the PLLAL business has gone from strength to strength. We are delighted that Promon has committed to the long-term future of PLLAL by acquiring a further 10% interest in the business. We both see exciting potential for further growth of our shared business in Latin America.”