Port Elizabeth-based e-coating specialist, Electrocoat, wishes to sell at least 51% of the business to a black investor.
Businesses that are successful in implementing major transformational changes will secure a sustained competitive advantage under the South African Automotive Masterplan 2035, which seeks increased black ownership with the local automotive industry, explains Electrocoat MD Angelique Adcock.
Adcock, whose father founded the e-coating business 11 years ago through loan funding, sees transformation as key to future growth.
“Taking on an equity partner would be a happy and healthy progression for Electrocoat,” she notes.
“There are many black business ventures in the automotive sector that would add great value to the business.
“We are not looking for an equity partner with no operational value,” she adds. “The partnership we are soliciting is one in which each partner has operational value, which is what we believe will ensure the company’s success and longevity.”
Adcock says the ideal partner would be a group or individual with some experience in manufacturing, especially in the automotive sector, as well as someone who is prepared to be involved in the day-to-day running of the business.
“This could include an existing component manufacturer that sees the value in acquiring ownership of an electro-coating business.”
Electrocoat uses the cathodic electro-deposited method to coat metal components and parts (made by component manufacturers or assemblers), thereby ensuring that these parts are durable and corrosion resistant.
Electro-coating – as opposed to powder coating or galvanising – is a popular coating technology, because of its superior adhesion and corrosion protection properties, says Adcock.
“In addition to automotive components, like seat rails and oil pans, we have coated some mouse locks, traffic light covers, solar panel brackets, medical equipment and fans.”
Electrocoat’s main clients are automotive component manufacturers, who ultimately supply their products on to Eastern Cape-based vehicle manufacturers such as Volkswagen, Isuzu and Mercedes-Benz.
The business’ estimated yearly turnover is around R10-million.
The company employs 26 people.