28 February 2013
Sephaku Holdings Limited (SepHold; JSE: SEP) has announced completion of its acquisition of the entire issued share capital of Métier Mixed Concrete (Pty) Limited (Métier Mixed Concrete) for R365 million.
Metier Mixed Concrete will now become a subsidiary of SepHold.
Métier Mixed Concrete is a supplier of ready-mixed concrete products, ranging from standard concrete to grouts, mortars, fibre-reinforced concrete and polished concrete, to coloured concrete. The company has a full-service technical division, provides a concrete-pumping service, and has capacity to supply specialised concrete to the higher end of the market.
SepHold chief executive officer Lelau Mohuba said: “This acquisition is a valuable addition to the SepHold asset base. Métier has a significant footprint in KwaZulu-Natal, and supports SepHold’s strategy of vertical integration.
“Together with our 36% holding in South Africa cement manufacturer, Sephaku Cement (Pty) Limited, Métier adds another valuable link in our developing African infrastructure and construction value chain and has the added benefit of immediate cash flows.
“SepHold provides Métier with critical mass and access to capital. It’s a ‘win-win’ transaction for both companies.”
Sephaku Cement is currently developing a cement production facility at Aganang, near Lichtenburg in the South Africa’s North West Province, which will have an estimated annual production capacity of 1.2 million tons a year. In addition, it is developing a grinding facility at Delmas in South Africa’s Mpumalanga province, with an estimated annual production capacity of 1.4 million tons of cement.
The Métier purchase consideration will be settled in in two tranches, through a combination of cash payments and shares in SepHold. All cash payments are fully financed through leveraged acquisition debt. On 28 February 2013, the first tranche of the transaction consideration was settled as follows:
- a cash payment of R110 million, funded through acquisition finance advanced by Standard Bank;
- the issue of 5 000 000 shares in SepHold to Métier at an issue price of R6 each (amounting to R30 000 000); and
- the issue of a further 11 111 111 SepHold shares to Métier at an issue price of R9 per share (amounting to R100 000 000).
The JSE Limited has approved the listing of an additional 16 111 111 SepHold shares each with effect from the commencement of business on 1 March 2013 at the respective issue price.
The second tranche will be settled on 1 December 2014 as follows:
- a cash payment of R125 million; and
- Agterskot: an additional amount of shares to be issued at a 60-day VWAP to the 1 December 2014 SephHold share price which would make the total consideration described in paragraph above equal to R100 million, subject to a maximum share price of R9 and a minimum share price of R4.
SepHold shareholders approved the acquisition in January 2013 and SepHold were advised by Sasfin Capital on the transaction.
Queries:
James Duncan, Russell & Associates
+ 27 11 880 3924
+ 27 82 892 8052
Note to editors: further background information is available on the following websites:
www.sephakuholdings.co.za
www.sephakucement.co.za