Imperial has entered into an agreement with the Afropulse, Willowton and Converting Trade groups which will give them the opportunity to participate in a 25% empowerment shareholding scheme in Imperial Logistics Group South Africa (ILSA).
Subsequent to the transaction, ILSA will house a significant majority of the Imperial group’s South African operations.
Converting Trade (of which Afropulse holds 61% and Willowton holds 39%) currently has a 25% shareholding in Imperial Logistics Advance (ILA).
Imperial Logistics South Africa, a wholly-owned subsidiary of Imperial, holds the remaining 75%.
As a result, ILA is a more than 51% black-owned and more than 30% black women owned enterprise.
Both Afropulse and Willowton are black women owned enterprises.
Willowton is an affiliate of the Willowton group, which is a manufacturer in the South African fast-moving consumer goods market.
Imperial says the transaction will ensure “significantly enhanced” broad-based black economic empowerment ownership for the majority of Imperial’s South African operations.
Improving the empowerment ownership and status of the group’s South African operations is critical for its future prospects, given its exposure to the South African market as part of its Gateway-to-Africa strategy, the group notes in a statement.
“The transaction will also enhance Imperial’s competitiveness and appeal to its clients and customers in South Africa, which will contribute to sustaining current earnings and achieving future growth.”
ILSA constitutes the largest component of Imperial’s South African operations in terms of revenue, and is currently a wholly-owned subsidiary of Imperial Logistics South Africa Holdings, which, in turn, is a wholly-owned subsidiary of Imperial.
ILSA comprises Imperial’s Dedicated Contracts, Cargo, Managed Solutions, Health Sciences, Truck Rental, Resolve, Fast ‘n Fresh and Cross-border businesses.
ILA comprises the Tanker Services Fuel and Gas, Tanker Services Food and Chemical, and KWS businesses.
It also has a 75% investment in Imperial Tanker Services Botswana, and 70% holding in Imperial Logistics Motion.
The core capability of ILA is the bulk road transportation management of liquid, gases, powders, ores and grains, which requires specialised assets and skills.
The purpose of the transaction, says Imperial, is to consolidate the businesses of ILSA and ILA and create an enlarged ILSA, with a 25% empowerment shareholding.