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Cape Town - Listed business services group Labat Africa (LAB) has agreed to sell its Africard business, which manufactures
Visa and Mastercard credit cards, to Oberthur Card Systems SA for a total of R20m, the company said on Thursday.
Labat also extended its cautionary, saying it was considering further transactions unrelated to the sale of Africard.
Labat acquired Africard from Altech (ALT) in February 2004, but opted to sell the business because the future capital demands of the business would have required major infusions of cash or borrowings.
The transaction will be effective from July 31, 2005.
Labat said that various obligations, including loans relating to the Africard Acquisition and legal settlements, will be discharged out of the R20m in sale proceeds and the balance, some R12m less a retention of R4.8m, will be applied to the reduction of Labat's debt.
The sale is subject to a number of conditions precedent, including approval from the regulatory authority and Labat shareholders.
Labat shareholders representing a total of 52.43% of the company's total shareholding had already given irrevocable undertakings to vote in favour of the deal, the company said.