The South African tech company with a new name which tripled investors’ money

iOCO, formerly known as EOH, has been one of the best-performing stocks on the JSE over the past year, gaining over 175% in the past twelve months.

This comes amid a tumultuous time for the company, which is still recovering from corruption investigations and an asset firesale to pay down its unsustainable debt burden. 

Over the past decade, investors in iOCO have experienced significant pain, with its share price plummeting by 99%. 

Before this, iOCO, then EOH, was a phenomenally successful technology company and investor darling. 

The company’s revenue increased consistently from 2001 to 2017, from R59 million to R15 billion. Its share price boomed as investors wanted a piece of the company. 

However, in 2017, media reports began calling into question some contracts between EOH and several government departments. 

Several bids for tenders with government departments were rigged, customers and suppliers were defrauded, and there was a significant amount of petty corruption. 

EOH executive Jehan Mackay was implicated in the bribery scandal to obtain government contracts between 2015 and 2016.

In 2020, EOH gave testimony to the Zondo Commission on its involvement in government corruption and state capture. 

 In 2017, the company won a tender of almost R300 million to update the Department of Home Affairs’s population register system, but as of 2022, no work has been completed. 

A subsequent investigation by forensic accounting firm Nexia SAB&T revealed that the company beat its competitors in a “corruption-infested” bidding process.

As a result, EOH’s CEO resigned and was replaced with Stephen van Coller, who was tasked with saving the company. 

Van Coller inherited a company with R16.3 billion in revenue, a net profit of R288 million, equity of R8.1 billion, and 11,500 employees.

However, the company’s debt burden weighed heavily on its operations and became a growing concern as some lenders, spooked by the corruption revelations, were asking questions about whether EOH would be able to repay its loans. 

Van Coller began firing employees implicated in financial maleficence and renegotiated problematic contracts.

He also testified at the Zondo Commission, sued former executives for R6.4 billion, and laid criminal charges against employees implicated in corruption.

This cost the company a lot of money and resources, which could have been better spent on growing its businesses. 

Van Coller also tapped shareholders for additional capital to reduce debt and slashed costs. He also sold many of the company’s best-performing assets. 

When Van Coller left the company in March 2024, it was a far smaller company with only R6 billion in revenue and posted a loss of R54 million for the year. 

EOH’s share price hit a low of R1.05 per share as investors ran for the hills, having lost faith in the company’s turnaround promises. 

The comeback

Van Coller was briefly followed in the hot seat by former executive chairman of EOH Andrew Mthembu, who resigned after two months at the helm in May 2024. 

Another interim CEO, Marius de la Rey, replaced Mthembu. This was the latest in a dramatic boardroom shakeup, with activist shareholders pushing for dramatic changes behind the scenes. 

On 10 May 2024, EOH revealed in a SENS announcement that certain shareholders had approached it regarding a succession plan for the company’s board. 

This marked a turning point for the company’s share price, with activist shareholders snapping up shares to increase their influence over the company. 

Crucially, other shareholders appeared to be more positive about the company after the company’s SENS announcement, with EOH’s share price appreciating by 20% in the following month. 

The positive momentum continued as activist shareholder and board member Rhys Summerton continued buying shares in the company. 

In the meantime, De la Rey’s efforts to stabilise the company and implement further cost-cutting measures were bearing fruit. 

The company announced in December 2024 that it would change its name to iOCO, a vital step in shifting the public perception of the company. 

Prominent investors began to take note, with Sasfin Securities’ David Shapiro backing the company to turn its fortunes around. 

“It should be a stock in your portfolio because the service they give is absolutely critical to every business,” Shapiro said. 

“What has always been attractive about EOH is that it has done essential services, which gives it pricing power. Technically, it should be flying, but there are a lot of issues it has to work through first.” 

Former FNB Wealth and Investments analyst Wayne McCurrie praised the company’s management for saving the business. 

“Management saved the company. It was an absolute disaster. It must have been the most difficult thing to get right at the time.” 

iOCO’s share price continued rallying throughout the rest of 2024, with it appreciating 195% from its lows in April 2024 to 7 March 2025. 

The confidence in the turnaround appears to have been rewarded with iOCO reporting on 13 February that it had achieved a 220% to 240% increase in its profit per share. 

Its trading statement said this should translate into a net profit of roughly R115 million to R134 million.

Positivity also surrounded the simultaneous announcement of the first permanent co-CEOs since Van Coller, with shareholders Rhys Summerton and Dennis Venter ascending to the helm. 

In a letter to shareholders, Summerton said they will begin to implement a 3-phase strategy to put iOCO onto a sustainable path. 

The three phases of their strategy are cost rationalisation, decentralisation, and resource allocation.

“We have worked closely with Marius and Ashona in implementing the cost rationalisation phase of the plan,” said Summerton.

“We thank Marius for his efforts in implementing this unpleasant — but necessary — process, and we wish him well in his future endeavours as he leaves the group this February.”

“This is good news for all those involved in iOCO. Our 4,000 customers can rely on iOCO to be a reliable and efficient partner,” he said.

“Our 4,500 employees can be assured that their hard work and loyalty to customers can now be rewarded with a fit-for-purpose head office team providing necessary support.”