The consortium bidding to buy out computer distributor Mustek has called off its plans to purchase the company, as the suspension of Section 45 Intragroup Relief in the Income Tax Act may result in an uncertain impact on the transaction.
Mustek issued a Sens statement Tuesday morning advising that the cautionary announcement has been withdrawn.
“We are going back to the drawing board to evaluate how this Act will affect this transaction as it formed the basis of it,” said Mustek CFO Neels Coetzee.
The company said last year that a consortium, led by CEO and founder David Kan, as well as the Trinitas Private Equity Fund, had put a non-binding offer on the table to buy out shareholders for R5.55 a share.
The Mustek share price fell almost 12% after the announcement.