Treacle savours R27m gain on ERP.com deal

Johannesburg, 25 August 2004 - Venture capitalists Treacle Venture Partners have made a R27m profit on their R15m investment in software company ERP.com.

Treacle sold its 43 million shares in the company this week at 98c each, well up from the 35c it initially paid. Its 25,3% stake was bought by the Black Information Technology Empowerment Company (Blitec).

The move raises the empowerment profile of ERP.com, which specialises in enterprise resource-planning software. Blitec is an investment company formed by the Black IT Forum to promote black professionals.

Treacle partner Christoff Botha said ERP.com had needed to do an empowerment deal, and Blitec approached Treacle nine months ago, asking to buy its shares.

“It was a good time for us to exit because we have had a good return on our investment. We have done very well for our investors in Treacle,” Botha said. “ERP.com is in a very strong position with R60m in cash and we expect it to come out with another good set of results. We will lose out on future upside, but it is time to move on.”

Treacle's backers include Nedcor, Hannover Re and Decillion, and the cash generated from the sale will be returned to them.

The deal would help ERP.com drive its transformation process once Blitec gained a seat on its board, CEO Peter Forsyth said. ERP.com had worked with Blitec on various initiatives in the past 18 months, and had found significant common ground on how they saw the sector developing, he said.