CS Holdings (CSH) lost 4c or 20% to close at 16c on the JSE yesterday after Bytes Technology Group (BTG) put in writing its firm intention to make an offer for the company.
The group is to offer one BTG share for every 37 CSH shares held.
"On the basis of the closing prices of BTG and CSH on the JSE on Thursday, 12 August 2004, the implied value of the offer is 15.68c per CSH share," the groups say in a joint announcement.
BTG has also proposed a mechanism to allow CSH shareholders to sell their shares to BTG parent Allied Electronics Corporation (Altron) for 15c per CSH share.
Although the offer is about half of the 30c Reunert considered offering when it began talks with CSH in April, BTG says there will be no increase in either the share ratio or disposal proceeds.
The making of the offer is conditional on the receipt by BTG, within the next two weeks, of irrevocable and unconditional undertakings by the majority of CSH shareholders to accept the offer. It reserves the right to waive or extend this precondition.
CSH management and executive directorate have undertaken to support the offer.
Once the deal has been completed, BTG intends to apply to the JSE to delist CSH.
The group says the acquisition of CSH would enable it to enter into new areas, in particular IT training and outsourcing. This is in line with its strategy of seeking opportunities to complement its own IT services and offerings.
The BTG share gained 10c or 1.7% to close at 590c yesterday.
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