STOP AND THINK

Finweek English Edition - - INVESTMENT - ed­i­to­rial@fin­week.co.za

Adapt IT has the stated in­ten­tion of grow­ing or­gan­i­cally and by ac­qui­si­tion, so why did the share go wild when the company is­sued a cau­tion­ary stat­ing “ne­go­ti­a­tions in re­spect of a pos­si­ble ac­qui­si­tion”? The stock ral­lied as much as 11.5%, be­fore clos­ing a more re­spectable 2.8% up on the day of the an­nounce­ment. Again, peo­ple need to think for a mo­ment and not chase fast­mov­ing prices. No sin­gle deal is go­ing to be that mas­sive in the life of Adapt IT as it would sim­ply mean far too much risk. So the deal is likely to be a smaller bolt-on ac­qui­si­tion or maybe an en­try into a new field, as it did with Aquilon.

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