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HUGE GROUP LIMITED - Voluntary announcement on the acquisition of intellectual property relating to Fixed Wireless Routers (FCRs)

Release Date: 19/08/2014 07:05
Code(s): HUG     PDF:  
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Voluntary announcement on the acquisition of intellectual property relating to Fixed Wireless Routers (FCRs)

HUGE GROUP LIMITED
(Registration number 2006/023587/06)
Share code: HUG     ISIN: ZAE000102042
(“Huge” or “the Group” or “the Company”)

VOLUNTARY ANNOUNCEMENT ON THE ACQUISITION OF INTELLECTUAL
PROPERTY RELATING TO FIXED WIRELESS ROUTERS (FCRs)

Shareholders are referred to the CEO’s Report in the
Integrated Report of the Company for the year ended
28 February 2014, in which one of the Group’s stated
objectives is to reduce the cost of installing router
equipment at its customers’ premises.

Huge Telecom Proprietary Limited (Huge Telecom) provides a
full outbound and inbound telephony service over a GSM last-
mile, using fixed-cellular (or fixed-wireless) customer
premises equipment. In simple terms, Huge Telecom installs
wireless telephone lines based on the GSM standard. The
advantage of this type of service is that it is simple, easy
to install and allows for high (“first tier”) levels of
reliability. Huge Telecom uses the networks of all the South
African mobile network operators and therefore in aggregate
has access to the most extensive cellular network coverage in
South Africa, whilst making use of devices that are fixed
cellular in nature, and is therefore able to offer an
unrivalled reliable quality of service.

At the end of its last financial year (28 February 2014) Huge
Telecom had a base of 20 000 installed telephone lines (or
connections) where the connection runs over a fixed cellular
router. During the first five months of this financial year
(up to 31 July 2014) Huge Telecom, through its Business
Partners, sold in excess of 5 400 telephone lines and thus
installed over 5 400 fixed cellular router channels.

With the growth in connections that Huge Telecom is
experiencing, it is becoming ever more important to reduce the
cost of investment in fixed cellular customer premises
equipment. At present Huge Telecom is spending between
R1 million to R1.5 million a month in the purchase of fixed
cellular routers.

The Board of Directors is pleased to announce that Huge
Software Proprietary Limited (a wholly owned subsidiary
company of Huge) has acquired intellectual property which will
enable it to manufacture a fixed cellular router at a
significant discount to its current cost of purchasing similar
equipment.
Huge Software has signed an agreement with Mr Deon Marais to
purchase the intellectual property that constitutes the
SpiderCell FCR. The SpiderCell FCR was originally
manufactured by DM Technologies Proprietary Limited.
Furthermore there is agreement in principle between Huge
Software and Deon Marais that a long term relationship is
envisaged. It is likely that Deon will assist with engineering
and further development, as well as production of the product
family/families.

Huge Software has also signed an agreement with Busiraks
Proprietary Limited and Mr John Walker to purchase the
intellectual property that constitutes the Xena FCR.

Both the Xena and the SpiderCell are well respected brands of
fixed cellular router that previously enjoyed significant
market share. Unlike FCR units sourced from overseas
suppliers, these devices are also completely locally designed,
developed, and field tested, and are therefore absolutely
compatible with the local South African GSM networks and
protocols, as well as being fully ICASA compliant and
certified, which will ensure complete reliability of operation
and service.

Johannesburg
18 August 2014

Designated advisor
Arcay Moela Sponsors Proprietary Limited

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