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After last month announcing that it plans to further expand its chemical manufacturing capability, JSE-listed Rolfes Holdings has inked a deal that will see it acquire the entire issued share capital in, and all the shareholders’ loans against, industrial ingredient importer Bragan Chemicals for R213.1-million.
As part of the agreement, Rolfes would issue 45-million new shares to Masimong Group Holdings – a 100%-held subsidiary of existing Rolfes shareholder and associate of nonexecutive director Michael Teke – and 3.34-million new Rolfes shares to Eziko Investments – an associate of nonexecutive director Dinga Mncube – at an issue price of R3 apiece, thereby raising R145-million.
The share placement would take black-owned Masimong Group’s shareholding in Rolfes from seven-million shares to 52.47-million shares – equivalent to 33.6% of the group’s total equity.
It would further result in a material increase in Rolfes’ overall black economic-empowerment (BEE) shareholding, which was expected to increase from about 27% to some 49.6%.
Following the share placement, the Masimong Group, through its subsidiary, would become an anchor shareholder and add “strong” BEE credentials to the company, which Rolfes said was of important strategic benefit in its drive to build a substantial black-controlled industrial group, strengthen organic growth and enhance its future acquisition strategy.
Rolfes added that the Bragan aquisition also provided it with a unique opportunity to acquire a major player in the food, beverage, bakery, dairy, pharmaceutical and cosmetics chemicals sectors.
“The acquisition of a well-respected and established industry player will allow the company to dramatically increase its exposure to these industry segments, which we believe have strong fundamentals and growth prospects.
“The acquisition [also] forms part of Rolfes’ long-term strategy to offer a complete range of chemical products to a wide range of industries and will allow the group to grow and diversify its earnings base into Africa and other attractive foreign markets,” the company outlined.
Rolfes intended to finance the acquisition through an equal combination of debt and equity funding.
The company meanwhile also announced that it would be making three key leadership changes, with immediate effect.
CEO Erhard van der Merwe would reliquish his position to continue as an executive director responsible for corporate finance activities, special projects and the implementation of the group’s acquisition strategy.
Van der Merwe would be succeeded by former COO and current group FD Lizette Lynch, whose role would be taken up by Nedbank Business Banking executive Siegfried Alfred Sergel.