Star 2023-06-21

Acquisition of reasonably well-managed company hailed as a sweet deal AFRIMAT’S share price leapt 12% yesterday after it announced the acquisition of 100% of leading building materials group Lafarge South Africa (LSA) for just more than R1 billion. The mid-tier mining group’s share price closed 7.91% up at R58.54 on the JSE yesterday, about 2% shy of the 52-week high of R61.01. Afrimat chief financial officer Pieter de Wit said they had been in talks with LSA for some time before agreeing on the price, and LSA’s parent Holcim Group’s exit from the local market was in line with its exit from all other Asian and African markets, so that Holcim could focus on European and US markets. De Wit said in a telephone interview that this was Afrimat’s biggest…

PRESIDENT Cyril Ramaphosa, Nether- lands Prime Minister Mark Rutte, and Denmark Prime Minister Mette Frederiksen have concluded a Heads of State Agreement to launch a new SA-H2Fund, which aims to secure $1 billion (R18.2bn) in funding for Green Hydrogen. SA-H2 is a blended finance fund that will facilitate and accelerate the development of a green hydrogen sector and circular economy in South Africa. The fund is supported by finance investment firm Climate Fund Managers (CFM) and Invest International (II) of the Netherlands, Sanlam Limited of South Africa, the Development Bank of Southern Africa, and the Industrial Development Corporation of South Africa!, in collaboration with other strategic partners. In a statement yesterday, CFM said the reason the fund was for hydrogen was that to reach net zero by 2050, the…

MOBILE operator MTN yesterday aired its corporate governance fight with IHS Holdings, which the mobile operator partly owns, saying it has breached a shareholder agreement and called for an extraordinary general meeting. MTN, through its subsidiary Mobile Telephone Networks, holds approximately 85.2 million shares or a 26% economic stake and controls 20% of the voting rights. However, the group does not have board representation in IHS currently. MTN said in a statement yesterday that IHS had “wilfully breached” the Shareholders’ Agreement and Articles by failing to notify its shareholders about a MTN corporate governance proposal and had denied its shareholders the opportunity to vote on it at the IHS annual general meeting (AGM). In light of this, the mobile operator has now requested the IHS board to call…

THE COMPETITION Tribunal ended the first day of hearings into the now Competition Commission conditionally approved takeover of national carrier SA Airways (SAA) by Global Aviation trading as the Takatso Consortium on a tense note, as the large sway of presentations were against the merger, at least in current form. Tribunal members, chairperson Mondo Mazwai, advocate Tembeka Ngcukaitobi and Dr Thando Vilakazi, heard from the commission, which was on the backfoot in justifying its recommendation of the deal. Its principal analyst, Wiri Gumbie, said that Takatso Aviation was created specifically for this acquisition and was bidding to acquire SAA operations, SAA Technical and Air Chef. He said the second part of the deal includes a “moratorium on merger- related retrenchments and to maintain a minimum number of employees at SAA.…

YESTERDAY the South African Reserve Bank (SARB) announced that the composite leading business cycle indicator decreased for a third consecutive month by 1% in April, but it is not all doom and gloom as economists predict a better set of data later in the year. The bank said that seven of the ten available component time series decreased, while the remaining three increased. “The largest negative contributors were a narrowing of the interest rate spread and a deterioration in the RMB/BER Business Confidence Index,” the SARB said in a statement. Business confidence in the country had deteriorated to a three-year low due to persistent load shedding and challenging economic conditions amid rising interest rates and cost pressures. The RMB/BER Business Confidence Index (BCI), released earlier this month, declined for a…

STANDARD Bank Group said its credit impairment charges were almost 50% higher in the five months to May 31 over the same period a year before due to larger lending books, consumer strain in South Africa and higher sovereign debt risk in Africa. Nevertheless the bank’s directors, who said 46% of headline earnings came from strong growth in other African countries, expected that headline earnings per share would increase by more than 20% for the six months to June 30, a trading statement released yesterday showed. The positive earnings forecast saw the group’s share price rise 2.02% to R177.29 by early yesterday afternoon, continuing an 18.9% surge in the largest bank in Africa’s share price since the end of last month. Top line growth was strong, driven by balance sheet…