Why alter now?
"We get that question a lot," admits executive chairman Tony van Marken. It’s understandable, with a market cap of R1,52bn – making DataPro the largest company on AltX now – and an expected R1bn in revenue for the full year. Interim results released this week add grist to the mill.
Van Marken says the group has thought about moving on to the main board but still sees greater merit in sticking to the junior exchange, for now.
He says listing costs are lower and institutional investors showed confidence in the company when it raised over R500m to make acquisitions, despite its AltX listing. This confidence is borne out by the popularity of DataPro’s shares, which on average trade 26m/month, valued at R22,3m.
Unlike companies listed on the main board, there is no need for AltX companies to send out a prospectus to shareholders when making a big acquisition. This provision proved useful when Data-Pro bought least-cost router Orion Telecom in a R380m deal. "It gives us speed and flexibility when making acquisitions," Van Marken says.
Orion is already making a strong contribution. The R76m it contributed in the past month is only slightly less than the R78m DataPro generated in total revenue in the corresponding period.
The top line is expected to get a further boost when the Independent Communications Authority of SA eventually settles on the interconnection rate it will impose on Telkom for making calls on DataPro’s network. This interconnection rate will in effect make it a fully fledged telecom company.
DataPro has not finished making acquisitions. It bought Dial Electronics and VOIP Telecorporation at the beginning of the month for an undisclosed amount. It is now looking to buy an Internet service provider as part of its strategy to increase its footprint in the consumer market, says Van Marken.
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