“The transaction is in line with EOH’s investment strategy to assist its intellectual property and software-based businesses to expand internationally,” the company said.
RIB Software will pay 90% of the purchase consideration, US$28.31 million (R399.95 million), in cash and will hold 10% as security for any shortfall in financial results or claims against EOH Mthombo.
EOH, whose shares have significantly stumbled at the Johannesburg Stok Exchange due to governance concerns, said it would use the cash proceeds mainly to reduce debt.
According to a Business Day report, the company – which previously said it was planning asset sales – said it had also entered into a put-and-call-option agreement to sell the remaining 30% of CCS to RIB in December 2022.
“RIB is specifically focused on the construction vertical and intimately understands what the clients in this sector want and as such represents a natural fit for CCS,” EOH said.
This deal was “a significant milestone” in EOH’s strategy to align with partners that could help it scale up certain of its “unique software businesses”.
“It is a crucial step forward for EOH’s intellectual property division and RIB is the right partner to unlock CCS’s full potential, enabling both future growth and internationalisation.”
Van Coller has led a probe into EOH’s past contracts with the state since he took the over in September 2018.