Datatec subsidiary, Westcon, has filed a registration statement with the US Securities and Exchange Commission for an initial public offering (IPO) of the company`s common stock on the Nasdaq Stock Exchange.
According to the registration statement, available at www.freeedgar.com, New York-based Westcon intends to use the net proceeds of the proposed listing to clear some of its debts.
It also plans to use a portion of the proceeds for working capital and general corporate purposes, including expansion of its sales force, value-added sales and support services, as well as expansion of operations outside the US.
It is unclear as to how much Westcon expects to get from the sale of the common stock. The statement does say the company will use approximately $75 million to repay amounts outstanding under its acquisition loan facility, as well as an undisclosed figure to pay off a portion of amounts outstanding under loans from Datatec.
The statement reads: "Pending these uses, we intend to either invest the remainder of the net proceeds of this offering in short-term, interest-bearing, investment grade securities, or repay a portion of amounts outstanding under our revolving credit facility."
A substantial portion of the company`s historical revenues has been derived from the sales of Cisco and Nortel products, which accounted for 45.8% and 22% respectively for fiscal 2000.
Avaya products, formerly the enterprise business of Lucent Technologies, are sold through the company`s Voda One division in the US only and account for 3.9% of sales. The company markets and sells Cisco, Nortel and Avaya products through its three branded divisions, Comstor, Westcon and Voda One, respectively.
Westcon says it also aims to achieve efficiencies by completing the implementation of Compass, its new centralised processing and information system.
Compass is designed to handle all aspects of information management in Westcon`s operations. It is Web-enabled, which will allow customers access to pricing and product availability, as well as enable them to place and track purchase orders online.
The company says that in terms of US Securities and Exchange Commission regulations, it is unable to comment further on the IPO.
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