* To pay between $50-60 mln -source
* Deal values Symphony at PE in teens
* Shares of Altech give up some gains
By David Dolan
JOHANNESBURG, Nov 1 (Reuters) - South Africa's Allied
Technologies Ltd is in talks to pay up to $60 million
for unlisted Kenyan IT firm Symphony, according to a person
familiar with the matter, to help revive its struggling business
in fast-growing east Africa.
Johannesburg-based Altech, a $742 million telecoms and IT
firm, has been in talks to buy Symphony for several months and
is nearing the end of its due diligence, said the source, who
declined to be identified because the information is not yet
public.
Altech is likely to pay between $50 to $60 million for
Symphony, giving it a price-to-earnings ratio in the teens, the
source said.
Buying Symphony, which has also has operations in Uganda,
Rwanda, Burundi and Ethiopia, would augment Altech's existing
business in a region where it has struggled.
Altech in September replaced the head of its underperforming
Kenyan data unit and named a new team to lead its east African
operation.
"The turnaround of our east African activities is clearly a
top priority within the group and is receiving considerable
management attention," the company said when it released its
first-half earnings in September.
South African firms are increasingly looking to do deals
beyond their crowded home market to tap into the rising
disposable incomes in poor but fast-growing regions such as east
and west Africa.
The deal would be one of the acquisitions made by a South
African company in Kenya, according to Thomson Reuters data.
It would also be the second-largest M&A deal in Kenya this
year following East African Breweries' $225 million
buy-back of an asset stake from SABMiller
.
Altech is a diverse business whose operations include
telecoms, electronics and IT services. In South Africa it is
best known for its Altech Netstar unit, which tracks and
recovers stolen cars.
Symphony provides IT consulting and services including
hardware, software and networking. It is owned by the Da Gama
Rose Group, led by prominent Kenyan businessman Horatius da Gama
Rose.
Its partners include IBM , Cisco Systems ,
Dell Inc , General Electric Company , Microsoft
Corp , China's Lenovo Group and Huawei
Technologies , according to its website.
No one was immediately available for comment at Altech or da
Gama Rose's office.
Altech shares gave up some of their gains following a
Reuters report on the deal. The shares were up 0.5 percent at
52.97 rand at 1055 GMT, from as high as 2.8 percent before the
news.
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