A consortium makes buyout offer for Torre Industries
A successful buyout means that Torre will delist from the JSE.
JSE-listed industrial group Torre Industries said a consortium has expressed a firm intention to make an offer to acquire 100 percent of its total issued ordinary share capital.
A successful buyout of Torre Industries means that the company will delist from the JSE.
Torre Industries said the consortium that intends to buy its shares comprises Main Street 1641, a special purpose vehicle established by Ethos Mid-Market Fund, and investment banking firm Apex Partners.
Under the offer, Torre shareholders will receive a cash dividend of 35 cents per share, with an overall value of about R179.9 million.
Shareholders will also receive a cash consideration of R1.05 a Torre share, which is equivalent to an aggregate cash consideration of almost R539.9 million for all the Torre shares, on the date on which the deal becomes operative.
Additionally, shareholders will receive a maximum deferred, top-up cash payment of up to 10 cents a Torre share, which is equivalent to a maximum cash consideration of about R51.4 million for all shares. However, this is subject to the achievement of certain performance targets.
Torre said the consortium believes that the underlying businesses within Torre and its subsidiaries have “limited synergies and require different capital structures, strategic goals and leadership in order to operate optimally and deliver improved operational performance.”
Accordingly, pursuant to the transaction and after the delisting, the consortium intends to separate Torre Group into two, namely the Torre Analytical Services businesses and the Torre Industrial businesses.
Torre Analytical Services will comprise WearCheck, Amis and the Set Point Lab Divisions, which will be retained by EMMF; and Torre Industrial will comprise the SA French, Manhand, Torre and Components, Tractor and Grader Suppliers, Letaba Pumps, Elephant Lifting and Torre Logistics divisions, which will be retained by Apex.
This separation of Torre Group, the consortium believes, will unlock value by allowing the businesses to operate independently and receive focused management attention, strategy implementation and enhanced empowerment credentials.