ConvergeNet Holdings is set to undergo a radical overhaul, setting itself up as an investment company under a new name, CQ Capital; transferring its listing on the JSE board; and disposing of some assets and acquiring others.
The company aims to transfer its listing to the Investment Companies sub-sector of the securities exchange. It will also dispose of Andrews Kit and Structured Connectivity Solutions, while acquiring a stake in Tellumat, Digicore, Praxin Financial Services and increasing its shareholding in Mine Restoration Investments and Goliath Gold Mining.
The company’s investment strategy is to grow a portfolio of equity, debt and hybrid securities, unconstrained by any particular market or sector, in listed and unlisted businesses, that will generate above average returns on capital for the company’s shareholders.
It intends to apply a hands-on investment approach, in order to assist management teams and to provide strategic input, without assuming direct operational responsibility, while applying a flexible investment approach relating to the timing and duration of investments.
Last week ConvergeNet concluded the terms of the sale of 100% of ConvergeNet’s interest in Contract Kitting and SCS for R95,119-million and R5-million, respectively, to Tellumat.
ConvergeNet has announced its intention of acquiring 30% of Tellumat, a privately owned company that operates in the telecommunications, defence and electronic contract manufacturing markets.
The Contract Kitting and SCS sale consideration will be settled by Tellumat by the issue of ordinary shares in Tellumat, so that ConvergeNet will hold 30% of the shares.
On 5 September 2014 ConvergeNet concluded the terms of the purchase of 17,64% of Digicore for R109, 23-million from Titan Nominees, Titan Share Dealers and Dale International Trust Company. Digicore provides its global client base with advanced mobile asset-tracking and management solutions.
The company has also concluded the terms of the purchase of an additional 30,32% of MRI for R25,27-million from AfrAsia Special Opportunities Fund and Titan Share Dealers. MRI is a holding company with its wholly-owned subsidiary, WUC, established to carry on the business of mine rehabilitation activities.
ConvergeNet has concluded the terms to buy an additional 16,30% of Goliath Gold for R48,04-million from ASOF, Titan Share Dealers, Dale International Trust and Crater Valley Investments.
Goliath Gold is a South African incorporated mining exploration company that has been listed on the Main Board of the JSE since May 2011. It focuses on identifying and exploring diversified resources across southern Africa, and holds gold prospecting rights and a mining right over several contiguous areas in South Africa’s East Rand Basin as well as prospecting rights for heavy mineral sands over an area in the Western Cape.
Praxis Financial Services is a leading provider of bridging finance to the motor body repair industry. ConvergeNet has concluded the terms to buy 40% of the company for a nominal R1.00 by way of the issue of new shares in Praxis.