Top deals making headlines this week

In focus this week: Steinhoff International, Brimstone, Sibanye-Stillwater, Nissan and more.

Brimstone

JSE-listed investment firm Brimstone Investments confirmed on Friday that it will not be participating in a consortium that is seeking to acquire South Africa’s biggest dairy producer Clover.

The company has agreed on a plan to facilitate its exit and to do so, it has entered into an agreement with a consortium that is looking to acquire Clover. In February, Brimstone said that it is reviewing its participation in a consortium that is seeking to acquire dairy producer Clover after protests over the participation on an Israeli company in the deal.

On February 4, Clover Industries said it received a R4.8 billion buyout offer from a consortium of companies called Milco, which offered Clover shareholders R25 per share. The Milco consortium is led by Israel-based Central Bottling Company (CBC), which is offering to buy 59.5 percent of Clover. The remainder of the shareholding would be held by Brimstone Investment Corporation (15 percent) and executive management of Clover (6.3 percent). Read more here

Steinhoff International

Embattled retailer Steinhoff International said it will proceed to implement the financial restructuring of its French furniture retail unit by raising a total of about €316 million (R5 billion) to ensure the stability of its capital structure and operations.

Steinhoff said the French Commercial Court of Meaux has approved a conciliation agreement entered into between Conforama and its creditors, paving the way for refinancing negotiations to continue and be implemented. In 2017, Steinhoff admitted to accounting irregularities, wiping about 85 percent off its market value. Read more here

Sibanye-Stillwater 

Diversified platinum group metals company Sibanye-Stillwater said it has raised R1.7 billion in an oversubscribed share placement, the company announced on Wednesday.

On Tuesday, Sibanye placed 108 932 356 new ordinary with existing and new institutional investors at a price of R15.50 per share, representing a two percent discount to the 30-day volume weighted average price on April 9. The placement represents five percent of its issued shares.The amount raised is slightly lower than its initial target of raising R1.8 billion as the company is in the throes of restructuring its gold mines. Read more here

Nissan 

Nissan plans to invest a further R3 billion in its South Africa plant to prepare for production of the latest version of the Navara pickup, according to a report by Bloomberg.

The decision by the car maker may add 30,000 units to the plant’s current annual volume of 35,000, Bloomberg quoted Nissan Africa MD Mike Whitfield. The manufacture of the Navara from 2020 will also create about 400 direct jobs in a country that has an unemployment rate of 27 percent, according to the report. Read more here

Barloworld 

South Africa’s industrial group Barloworld is set to boost its black shareholding through a deal involving its R3.5 billion-worth black economic empowerment scheme.

The company, which is listed on the Johannesburg stock exchange, will increase its black ownership to 48 percent from 32 percent after the sale of its R2.9 billion property portfolio to a new black-owned company Khula Sizwe Property Holdings. It will lease back the properties for a 10-year period. Read more here.

ADvTECH

JSE-listed private education provider, ADvTECH, said its acquisition of Monash South Africa (MSA), a university, has become unconditional following the fulfilment of all conditions precedent, including approval by the Competition Tribunal.

The transaction became effective from April 1 2019 which will result in MSA now being incorporated into ADvTECH’s higher education division, The Independent Institute of Education, and will be branded IIE MSA. This increases the tertiary student complement of ADvTECH to more than 43 000. Read more here

Net1 

South Africa and US-listed technology company Net1 UEPS said it has concluded a deal to reduce its shareholding in DNI-4PL Contracts (DNI) to settle a R400 million vendor obligation.

The company said it will reduce its shareholding in DNI from 55 percent to 38 percent. The transaction will happen through Net1 UEPS’ wholly owned South African subsidiary, Net1 Applied Technologies South Africa Proprietary Limited. DNI, which was founded in 2005, provides pre-paid airtime services and mobile subscriber starter packs. Read more here

Afrimat 

South Africa’s building materials supplier Afrimat has made an offer to acquire Australia’s Universal Coal for up to A$209 million (R2.1 billion), the company announced on Monday.

The nonbinding indicative offer for all of Universal Coal’s 522-million shares was “in line with Afrimat’s strategy of diversification.”

Afrimat has set the purchase price at A$0.40 for each Universal Coal share held. Universal Coal is listed on the Australian stock exchange and has operations in South Africa. Read more here

Arrowhead

South Africa-based real estate companies Arrowhead Properties and Gemgrow have announced an intention to merge, a move that will see more consolidation in the sector.

The boards of Arrowhead and Gemgrow said on Wednesday that they had agreed in principle to a transaction, which would result in the reverse takeover of Gemgrow by Arrowhead.

Over the past five-years, South Africa’s real estate market has seen the merger of smaller and less liquid publicly traded companies. Market watchers say the consolidation of companies in the market would create growth opportunities for merged entities. Read more here

Helios Investment Partners

Africa’s Sub-Saharan gas and power portfolio company, Axxela Limited, has announced its formal acquisition by Helios Investment Partners, a leading private equity firm.

Oando plc has entered into a sale agreement with Helios Investment Partners, a leading private equity firm, to dispose of its remaining 25 percent stake in Axxela (formerly Oando Gas & Power) the Nigerian gas and power company.

Helios had initially purchased a majority stake in Axxela’s gas and power business enterprise in December 2016. Helios acquired 75 percent of Axxela in 2016 via a special purpose vehicle HIP GLOVER. The total purchase consideration was $41.5 million (R581 million).