Company Announcement - AltX engineering technology company, Ansys Limited, is set to further deepen its product offering, expand into new markets and diversify its income streams with the R93,2 million acquisition of Parsec Holdings (Pty) Ltd.  Parsec develops complementary technology-driven engineering solutions for the companies’ common markets - mining, industrial, telecommunications and defence. The acquisition aligns with the group’s goal of becoming an intellectual property-led provider of technology driven engineering solutions.

Ansys will effectively acquire 100% of all companies in the Parsec group, save for Redline Technologies in which it will acquire a 75% stake. The purchase consideration will be paid half in cash with the balance in Ansys ordinary shares to be issued at 40 cents each. 

CEO Teddy Daka says: “The Parsec acquisition meets the key criterion of boosting our intellectual property capacity and cache.”  The 45 incoming highly skilled engineers will help entrench the group as an innovator in its field.  “The complementary product offerings are also a perfect fit.  Although Parsec serves the same industries as Ansys, there is currently minimal overlap in product and services enabling us to offer new solutions to existing markets and diversify our income streams,” says Daka. The acquisition will further provide Ansys with first-time entry into the international defence market through certain of Parsec’s product lines such as radar, optical wireless broadband and digital signal processing, and expose Ansys to longer-term contracts with annuity income potential in line with strategy.

The move marks a significant milestone in the group’s growth trajectory and follows a complete group restructuring over the past year.  The revision programme included Ansys’ diversification into high growth telecoms through the acquisition of Tedaka Technologies, a cost and efficiencies overhaul and an intensified focus on R&D.

Parsec is a holding company for a number of subsidiaries which form part of the transaction.  Parsec (Pty) Ltd is a leading electronic engineering company which provides all-inclusive embedded solutions to original equipment manufacturers (OEMs), system integrators and product suppliers. Redline Telecommunications SA is a leading supplier of wireless and data infrastructure in Africa. Redline Technologies is the industry leading manufacturer of carrier grade, point-to-point Gigabit Optical Wireless Broadband (OWB) equipment for the enterprise, telecoms and military markets. As per its name, Parsec Properties is a property holding company.

Daka concludes: “The acquisition is another progressive step aimed at cementing our turnaround and furthering our vision of becoming an intellectual property leader in our field.  In addition to the specific benefits to our top line and skills pool, we intend to leverage other synergies and general economies of scale for profitable growth.” 

The acquisition remains subject to a number of suspensive conditions which must be fulfilled within three months.

Ansys’ interim results for the six months to August are set to be released on or around 26 November. The share closed Friday at R0.42.