JSE-listed Faritec Holdings has acquired, as a going concern, the IT storage solutions business of Lechabile Storage Solutions in a deal worth R15.98 million.
Faritec says in a statement that the business being acquired consists of the assets used in the conduct of the business together with certain liabilities incurred in the ordinary course of the business, but excluding all other liabilities.
"As at the effective date (31 January 2006), the value of the sale liabilities exceeded the value of the assets of the business by R8 240 395," Faritec says.
The purchase price is being settled by the assumption of the net sale liabilities, the payment of about R3.1 million in cash, and by procuring the issue of shares worth R4.6 million.
Half of the shares will be issued to Lechabile on the close of the deal and the balance six months later.
The deal is subject to various conditions.
Faritec says the acquisition will establish it as a leading provider of information integrity solutions by broadening its storage and security solutions.
"It will also enhance Faritec`s position with IBM and Veritas and adds a FileNet capability to Faritec`s significant technology solutions suite."
Lechabile Storage Solutions was established in 2003 when Lechabile IT Services signed an agreement with Dan McMahon, who had acquired MGX`s storage solutions business in a management buyout.
Faritec`s share was trading unchanged at 80c this morning.
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