JSE-listed Mustek is the target of a takeover bid by packaging and printing company Novus Holdings, which is in turn seeking to diversify from its printing, packaging and tissue manufacture businesses.
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Novus Holding, the printing, packaging and tissue manufacturer, has won a High Court appeal to overturn a decision taken by the Takeover Regulation Panel (TRP), to withdraw its approval of the takeover of ICT distributor company Mustek.
On March 28, 2025, the TRP had ruled that it had “unilaterally withdrawn” its approval of Novus’ announcement on November 15, 2024, to acquire Mustek, and it had asked that Novus publish a revised offer.
Novus had originally made a mandatory offer to Mustek shareholders for shares it did not already own, of R13 cash per share, or R7 in cash plus one Novus share, or two Novus shares per Mustek share. Novus has pursued Mustek as part of a strategic diversification strategy.
Novus “strongly disagreed” with the TRP ruling and appealed the ruling at the High Court on an urgent basis, “on the grounds that it was improper.” The appeal was heard on April 25, 2025.
The High Court declared the TRP ruling unlawful, unconstitutional, and set aside, on April 26.
The court order directed Novus to post an offer circular reflecting its firm intention announcement (FIA) and supplementary FIA dated March 6, 2025, within five days of the date of the order.
The TRP was ordered to pay the cost of the application, including the cost of two counsel.
Novus said it would engage with the TRP to publish its circular to Mustek shareholders as soon as possible.
The TRP, according to the Novus statement, was evaluating the High Court's decision and how it affected its regulatory authority.
However, the TRP had indicated it would take the necessary steps to avoid delaying the transaction or allegations of contempt of court, while reserving the right to reconsider the issue once the court shared its reasoning for its decision with the involved parties.
Novus’ share price fell by 3.7% to R6.56 Tuesday afternoon. Mustek’s share price was 1.74% lower at R13.50, well up from the R8.98 that it traded at a year before on the same day.
In the six months to December 31, 2024, Mustek’s headline earnings per share fell 74.3% to 23.47 cents, after revenue fell 14.1% to R3.66 billion.
The company said at the time it was under pressure due to challenges posed by global and local economic conditions. These had included persistent inflation, high interest rates, sluggish economic growth, and fluctuating consumer and investor confidence, both in South Africa and internationally.
The 14% decline in revenue was ascribed to economic constraints, lower consumer demand, and being selective in only pursuing deals that align with risk appetite and profitability targets.
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