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Logicom confirms NewCytech deal

by Stuart Wilson, Wednesday 29 July 2009

Cyprus-quoted distribution player Logicom has confirmed a deal to acquire NewCytech Business Solutions in a deal worth US$15.6m. The deal was conducted through Logicom Services Holdings – an entity 100% owned by Logicom Public Limited. The deal represents one of Logicom’s first forays into the area of services and IT solutions.

Logicom Services Holding picked up a 36.77% stake in NewCytech from the heirs of Michalis Michaelides for US$4.27m. The acquisition vehicle has also signed agreements with NewCytech and other shareholders to purchase the remaining shares for US$11.27m based on the future results of NewCytech.

The deal, which is subject to legal and accounting audits, is expected to close by the end of September. NewCytech’s annual sales hit US$19.84m in 2008 with after tax profits of US$1.18m.

In a statement announcing the progress of the deal, Logicom declared: “The acquisition of 36.77% of the issued shares and the corresponding voting rights in NewCytech expands Logicom’s interests in the sector of services and completed IT solutions and increases the possibilities of synergies and exploitation of offered services.”

“Besides, the prospect of NewCytech joining Logicom Group on the basis of the Agreement and the Acquisition Plan is expected to contribute significantly to the increase in the turnover and to improve the profitability of the corresponding sectors,” the statement continued. Logicom first announced that it had entered negotiations with NewCytech earlier this month.

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February, 2020

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