JSE-listed construction group Wilson Bayly Holmes-Ovcon (WBHO) has received an indicative proposal from a major international construction company to acquire the company’s 88% interest in Australian construction subsidiary Probuild.
WBHO on June 3 stated that it, from time-to-time, received unsolicited proposals for Probuild, ranging from strategic alliances and partnerships to acquisition interest in the business.
Because the company focuses on maximising value for shareholders, WBHO is currently in discussions with financial adviser Investec Bank, and legal advisers King & Wood Mallesons and Bowmans, in relation to the indicative proposal and the conditions that a potential buyer would have to fulfil.
The board points out that there is no certainty that a binding proposal will be forthcoming and what the final terms of such a proposal might be.
WBHO says it remains optimistic about the long-term fundamentals of Probuild and its longer-term growth prospects in the Australian market, despite current uncertainty related to Covid-19.
Meanwhile, in a trading update that the company also released on June 3, WBHO says all its operations, in South Africa and elsewhere, are ready to safely restart work, after many projects were placed on hold.
The company advises that certain civil engineering projects had resumed under Level 4 of lockdown of South Africa, in May, and that the remainder of projects resumed on June 1.
In Australia, both infrastructure and building projects were considered essential services and all projects remained operational in the last few months and continue to operate.
All but four projects continued to operate in the UK in the last three months; however, the four suspended projects have subsequently restarted in the last few days.
WBHO further states that its operations continued uninterrupted in both Zambia and Ghana, while all its projects in Botswana were suspended until April 30.
Work in Mozambique was suspended in line with South Africa’s lockdown.
The company points out that the impact of international travel restrictions, anticipated quarantine periods once travel is allowed, and logistics will impact on the startup of a number of projects in the rest of Africa.
WBHO has submitted contractual claims attributable to Covid-19 and will negotiate in good faith with clients on a contract-by-contract basis.
“We are aware of the immense pressure that Covid-19 will undoubtedly place on the economies of those countries in which we operate, and we are taking all necessary steps to preserve cash reserves.”