Mergers, Acquisitions and Financial Results

Fixed-line operator Telkom has had to put the brakes on its buyout of information technology services (IT) company Business Connexion (BCX), as it has not met all the conditions for the deal to go through. Telkom had expected the competition authorities to decide on whether to give the deal the go-ahead or not by Thursday, August 10.

Also, the registrar of companies (in terms of the companies act) has not yet registered a certified copy of the order of court sanctioning the BCX scheme.

As such, Telkom cannot provide the market with the salient dates for the scheme, such as the last day to trade in BCX shares, when BCX's listing will be suspended and the record date to determine participation in the scheme.

Telkom is offering BCX shareholders R9 a share and a 25c dividend. It says it has secured support from over 50% of BCX's shareholders.

Three-quarters of the shareholder base must approve for the deal to go through. In a joint stock exchange announcement issued in May, the companies had set August 29 as a date for BCX's delisting from the JSE.

The deal falls through unless Telkom meets all conditions by December 15, or a date that BCX and Telkom agree to in writing.

Telkom will make a further announcement about the scheme dates 'should the conditions precedent be fulfilled'. BCX shares closed 0,6% higher at R8,35 apiece. Moneyweb