JSE-listed Blue Label says that it will acquire 3G Mobile through its subsidiary, The Prepaid Company, for R1.9 billion.<\/p>\n
3G Mobile is a distributor, and financier, of mobile devices and handsets to major retailers and cellular network providers.<\/p>\n
It operates in eight African countries, with offices in South Africa, Namibia, Botswana, Mauritius and distribution channels into Zambia, Zimbabwe, Swaziland and Lesotho.<\/p>\n
It has distribution rights for all major tier one and tier two mobile device and handset manufacturers, including Apple, Samsung, Huawei, HiSense, ZTE and Nokia.<\/p>\n
Blue Label said that R250 million will be settled by the issue of shares to the 3G vendors.<\/p>\n
The cash consideration of R1.65 billion will be funded either from available cash resources, a further placement of shares, banking facilities or a hybrid thereof.<\/p>\n
Through its wholly-owned subsidiary, Comm Equipment Company, 3G Mobile provides the financing of the mobile handset component of post-paid contracts to cellular network providers including Cell C.<\/p>\n
At present, the CEC finance book is approximately R3.0 billion, Blue Label said.<\/p>\n
“3G Mobile shall be utilised as Blue Label\u2019s expansion platform into the financing and supply of mobile devices, handsets and allied products. Both of these functions supplement Blue Label’s strategic objectives to provide value added services to both Cell C and its own customer base,” Blue Label said.<\/p>\n
The group added that 3G Mobile provides the ideal platform to consolidate its low cost and certified pre-owned mobile handset divisions into a consolidated group.<\/p>\n
The net profit after tax of 3G Mobile for its year ended December 2016, after adjusting for non-recurring expenditure, amounted to R248 million.<\/p>\n
It is expected that its net tangible assets will be no less than R1.0 billion rand as at the effective date of the Initial Acquisition, Blue Label said.<\/p>\n