Exchange-Listed Companies
Economic headwinds and the sharp devaluation of the naira, has over the past two years, negatively impacted mobile operator MTN’s bottom line. The impact of the lacklustre performance of the company’s share price is problematic for the company’s soon to mature Zakhele Futhi B-BBEE scheme. The scheme launched in November 2016 subscribed for 4% of the company’s share capital at R102.80 (an effective 20% discount) and is due to mature in November 2024. However, for full settlement to be achieved the MTN share price would need to reach c.R88.00 per MTN share. Like many BEE deals of its era, the scheme is effectively underwater, projected to owe R620 million to the preference share funders and R6,1 billion to MTN. Subject to shareholder approval, MTN will extend the structure for a further three years to 2027 with the option to unwind the scheme either partially or fully during the period if conditions improve.
Argent Industrial has announced that it is to acquire Standmode and its subsidiary Mersey Container Services for £6,89 million (R159,3 million) in a move to scale its business by further diversifying its portfolio of companies and expanding internationally into the UK. Mersey manufactures modular buildings, offices and mess units which can be stacked or linked depending on requirements. The deal is a category 2 transaction and as such does not require shareholder approval.
The acquisition announced in June by York Timber of several standing timber plantations has been amended following the destruction of the Wolberg farms by a fire. The deal with Stevens Lumber Mills will be implemented excluding the affected farms at a reduced deal value of R41,36 million, previously R75 million.
Oando PLC has completed the September 2023 acquisition of the Nigerian Agip Oil Company from Italian energy company Eni. The US$783 million transaction is significant in Oando’s long-term strategy to expand its upstream operations and strengthen its position in the Nigerian oil and gas sector.
In July MAS PLC released a cautionary announcement advising shareholders that it was considering a restructure proposal to simplify and achieve control of its development joint venture with Prime Kapital named PKM Development. The company this week issued a further cautionary, advising shareholders that the process relating to the proposed restructure had terminated without PKM Development and Prime Kapital reaching agreement.
Unlisted Companies
Solarise Africa, a pan-African Energy-as-a-Service company has secured a R160 million investment from Mergence Investment Managers. Solarise provides innovative and affordable solar energy solutions with a focus on delivering reliable and sustainable energy. The funding will be used to advance the deployment of Commercial and Industrial scale renewable energy solutions in South Africa.
Qatar Airways has made an equity investment into Airlink, taking a 25% stake in the local carrier as it seeks to expand its presence in Africa. For Airlink, the transaction will unlock growth by providing efficiencies of scale, increasing the airline’s capacity and expand its marketing reach. Financial details were not disclosed.
DealMakers is SA’s M&A publication.
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