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Local mobile networks are set to pay technology group Altron over R1-billion for its Autopage subscriber base, according to a market update.
In May, Johannesburg Stock Exchange (JSE) listed Altron said it is at an advanced stage of negotiations regarding the potential disposal of Altech Autopage’s subscriber bases.
Autopage is a phone service provider that sells the likes of MTN, Cell C and Vodacom contracts.
Altron has sought to dispose of Autopage amid impacts of the ongoing mobile termination rate reductions, as well as continued industry and consumer deflationary pressures.
And on Wednesday, the company detailed how much it plans to sell its subscriber base and handset book for. MTN, Vodacom and Cell C are set to be buyers of Autopage’s subcriber base and parts of its handset books.
In a market update, Altron highlighted the following:
- The cash consideration to be received by Autopage as a result of the disposal of its MTN, Cell C and Vodacom subscriber bases to the purchasers will equal approximately R1.46bn plus VAT (value added tax).
- MTN has agreed to purchase Autopage’s handset receivables book pertaining to its subscriber base for a purchase price of approximately R219m plus VAT.
- Cell C and Vodacom have agreed to the billing and collection of Autopage’s handset receivables book pertaining to their respective subscriber bases less agreed administration charges that they may incur.
Altron said the disposal is subject to the conclusion of certain service level, prepaid services, handset receivable services and escrow agreements.
In terms of JSE requirements, Altron also needs shareholder approval for the disposal to go ahead.
The company subsequently said that shareholders will be posted within 60 days of the date of this announcement and that they will also receive a notice of general meeting.
Meanwhile, the company has also highlighted how the disposal could benefit Altron.
“The Autopage Disposal Consideration proceeds and cash realised as a result of the sale of the handset receivables books will be used to reduce the overall Altron group debt and restore cash to the company’s balance sheet,” said Altron in the market update.