Al­tron buys 100% of Fleet Lo­gis­tics in Oz

The Star Early Edition - - COMPANIES - Sandile Mchunu

JSE-LISTED in­for­ma­tion and com­mu­ni­ca­tion tech­nol­ogy com­pany Al­lied Elec­tron­ics Cor­po­ra­tion Lim­ited (Al­tron) has ac­quired 100 per­cent of the share­hold­ing of Fleet Lo­gis­tics, an Aus­tralian fleet man­age­ment busi­ness based in New South Wales, Aus­tralia.

The group ac­quired Fleet Lo­gis­tics through its whol­ly­owned sub­sidiary, Al­tech Net­star, as part of its strat­egy to strengthen its po­si­tion in in­ter­na­tional mar­kets.

Fleet Lo­gis­tics is trad­ing as EZY2C and the com­pany spe­cialises in fleet man­age­ment so­lu­tions for lo­cal gov­ern­ment, the car rental in­dus­try, and com­mer­cial cus­tomers.

Al­tron chief ex­ec­u­tive Mteto Ny­ati said on Fri­day that the ac­qui­si­tion would add to Al­tech Net­star’s rapidly grow­ing sub­scriber base in Aus­tralia and it will pro­pel Al­tech Net­star as a dom­i­nant com­peti­tor in the fleet man­age­ment in­dus­try in Aus­tralia, with an in­stalled base of more than 40 000 ve­hi­cles.

It is not the first ac­qui­si­tion in Aus­tralia by Al­tech Net­star. The group ac­quired Pin­point Com­mu­ni­ca­tions in May 2015, a busi­ness with more than 15 years of ex­pe­ri­ence in of­fer­ing ser­vices such as ve­hi­cle telem­at­ics; as­set, fleet and works man­age­ment; driver and per­son­nel iden­ti­fi­ca­tion; and cer­ti­fied telem­at­ics.

“In 2015, we ac­quired Pin­point Com­mu­ni­ca­tions in the Aus­tralian mar­ket. That ac­qui­si­tion helped Al­tech Net­star to leapfrog com­peti­tors in the fleet man­age­ment and telem­at­ics space. Their strong re­search and de­vel­op­ment ca­pa­bil­i­ties con­tinue to pro­vide the group with tech­nol­ogy ad­van­tage. Al­tech Net­star is gain­ing share in fleet man­age­ment and de­liv­ered a solid per­for­mance in our last fi­nan­cial year,” Ny­ati said.

He added that the EZY2C ac­qui­si­tion gave the group the scale in a mar­ket that is highly frag­mented. “It also ex­tends our pres­ence into new ter­ri­to­ries pre­vi­ously not cov­ered by Pin­point Com­mu­ni­ca­tions. The com­bined oper­a­tions will bet­ter serve both en­ter­prise and gov­ern­ment cus­tomers,” he said.

Peter Takaen­desa, a port­fo­lio man­ager at Mer­gence In­vest­ment Man­agers, said the ac­qui­si­tion of Fleet Lo­gis­tics fits well into Al­tron’s turn­around plans, which in­volve ex­it­ing man­u­fac­tur­ing oper­a­tions and fo­cus­ing on the in­for­ma­tion tech­nol­ogy and telecom­mu­ni­ca­tions sec­tors.

“The change in group strat­egy has been sup­ported by the re­cent ap­point­ment of a new group chief ex­ec­u­tive with ex­pe­ri­ence in the new fo­cus sec­tors of in­for­ma­tion tech­nol­ogy and telecom­mu­ni­ca­tions,” said Takaen­desa.

He said the ac­qui­si­tion would help im­prove their size in the Aus­tralian mar­ket as well as marginally lift the group’s geo­graphic di­ver­si­fi­ca­tion.

“How­ever, we note that Al­tron has not dis­closed the full fi­nan­cial de­tails of the trans­ac­tion and has also not pub­lished a Stock Ex­change News Ser­vice state­ment, sug­gest­ing that the ac­qui­si­tion is not ma­te­rial in the con­text of the Al­tron group. We have seen a clear trend of many South African in­dus­trial com­pa­nies al­lo­cat­ing more cap­i­tal to Aus­tralia and Europe,” Takaen­desa said.

Al­tech Net­star manag­ing di­rec­tor Harry Louw said the com­pany had been work­ing on this trans­ac­tion for some time in the knowl­edge that it would pro­vide Al­tech Net­star with a dom­i­nant foothold in Aus­tralia’s lo­cal gov­ern­ment mar­ket, which re­quires ad­vanced and in­no­va­tive so­lu­tions.

“Com­bin­ing EZY2C so­lu­tions with Al­tech Net­star’s wide range of so­lu­tions and low cost prod­ucts will en­able us to ag­gres­sively grow our busi­ness in Aus­tralia,” Louw said.

Al­tron share price closed 0.33 per­cent lower at R12.16 on the JSE on Fri­day.

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