Johannesburg - Telkom SA has offered to buy Business Connexion for R2.67bn as it seeks to expand its information and communication technology services.
Under the transaction, ordinary shareholders will receive R6.60 per share, a 20% premium over the R5.50 the stock was at before Business Connexion first alerted the market about a possible deal on April 15.
"A key consideration of our strategy is to grow beyond our core business of connectivity and expand into end-to-end ICT services," Telkom CEO Sipho Maseko said in a statement. "This will form part of the strategy to improve performance and restore profitability."
Business Connexion, which runs information technology infrastructure such as data centres, will become a Telkom subsidiary and delist from Johannesburg's stock exchange if the deal goes through.
Its shares initially jumped as much as 9% on the news on Thursday, before retracing to 6.9% at R6.37 by 07:57 GMT.
Those of Telkom dropped 1.3% to R37.66, compared with a 0.6% rise by Johannesburg's All-share index
Under the transaction, ordinary shareholders will receive R6.60 per share, a 20% premium over the R5.50 the stock was at before Business Connexion first alerted the market about a possible deal on April 15.
"A key consideration of our strategy is to grow beyond our core business of connectivity and expand into end-to-end ICT services," Telkom CEO Sipho Maseko said in a statement. "This will form part of the strategy to improve performance and restore profitability."
Business Connexion, which runs information technology infrastructure such as data centres, will become a Telkom subsidiary and delist from Johannesburg's stock exchange if the deal goes through.
Its shares initially jumped as much as 9% on the news on Thursday, before retracing to 6.9% at R6.37 by 07:57 GMT.
Those of Telkom dropped 1.3% to R37.66, compared with a 0.6% rise by Johannesburg's All-share index