| Tue 10 Jul 2007, 16:17 | | LAF - Lonrho - Acquires 45% Of South African Shipp |
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LAF
LOLAF
LAF - Lonrho - Acquires 45% Of South African Shipping Line
Lonrho Plc
(Formerly Lonrho Africa Plc)
(Incorporated and registered in England and Wales)
(Registration number 2805337)
(Share code: LAF; ISIN number: GB0002568813)
("Lonrho" or "the Company")
ACQUIRES 45% OF SOUTH AFRICAN SHIPPING LINE
Lonrho (AIM: LONR), the African conglomerate with a diverse portfolio of
investments ranging from infrastructure, transportation, support services and
natural resources, announces that it has acquired a 45% stake in SA Independent
Liner Services (PTY) LTD ("SAILS") for a total sum of US$6.0m. Lonrho also has
an option to acquire a further 6% stake in the company from existing
shareholders over the next 5 years.
THE SAILS OPERATIONS
SAILS is a ship operator and shipping line currently based in Cape Town, which
focuses on shipping freight from South Africa to West Africa, Belgium, Germany,
Holland and the UK. SAILS concentrates on containerised shipping and works
closely with four strategic South African industries; motor manufacturing,
chemicals, mining and agriculture. Each of these industries are large water-
based transport users.
Current clients include world leading companies focusing on chemical
manufacturing, food retailing, and transportation, Some of SAILS`s larger
clients are:
Sasol
Tesco
ZIM Line
THE SAILS FLEET
The SAILS fleet currently operate two sister ships, namely the 8,300 tonne MV
Berta and 8,300 tonne MV Emilia. Both vessels have a carrying capacity of 650
twenty foot containers (TEU) and onboard cranes suitable for small ports.
Lonrho`s investment will be used to expand the fleet to five vessels over the
next nine months.
SAILS has been operating since March 2006 and has already secured US$20 million
worth of shipping contracts for the next twelve months for its two existing
vessels. The additional vessels scheduled to join the fleet over the coming
months will allow SAILS to add additional contracts and customers to next year`s
order book.
THE SAILS SHIPPING ROUTES
The focus is to provide a regular, reliable scheduled service to West Africa,
and Europe calling at - Durban, Port Elizabeth, Cape Town, Tema; Lagos,
Rotterdam, Felixstowe, Bremerhaven and Antwerp. In the medium term SAILS is
constantly monitoring and assessing alternative trade routes, including
potentially East Africa, looking to expand rapidly to support the needs of its
already strong client base.
South Africa has no commercially navigable rivers, but, capitalising on the
country`s two-ocean frontage, ocean shipping has long been a feature of its
transportation network. Approximately 98% of the country`s exports are conveyed
by sea. Containerised freight movements into and out of South Africa have been
growing at more than 6% per annum for the past 10 years. The average annual
growth rate from 2003 to 2006 was 12%. With West African connections developing
steadily and with the World Cup Football being hosted in South Africa in 2010,
volumes are set to increase on a consistent basis. Container shipping remains
the most efficient, viable and eco-friendly mode of transport for international
freight shipments.
Ian Wicks will continue as the Managing Director of SAILS. Ian has 30 years
experience in the freight shipping and logistics industries.
This deal builds on and strengthens Lonrho`s interest in transport in Africa and
taps into an industry that will benefit greatly from increasing trade between
Africa and the rest of the world.
David Lenigas, Lonrho`s Executive Chairman and Chief Executive, commented:
"We are delighted to announce this subscription for a substantial interest in
SAILS. The company`s operations connect Europe to Africa providing the
opportunity to strengthen trade connections between the two continents. The
company has an experienced management team and a blue chip client base and we
are excited at the future growth prospects of the company. Amongst others, the
ZIM Line contracts (the world`s 10th largest shipping line), demonstrates the
confidence that the market has in the future of SAILS"
"SAILS joins Fly 540, Norse Air and Lonrho Air, as part of Lonrho`s
transportation division and this acquisition is another example of Lonrho`s
strategy of supporting African infrastructure. We believe that by investing in
transportation and related companies, international and national trade will
grow, living standards will improve, and a substantial difference will be made
in Africa."
Ian Wicks, SAILS Managing Director, commented:
"The subscription by Lonhro signals a new chapter in the development of SAILS.
This is an age old industry and the links and support that SAILS has developed
in its first year of operation will definitely grow and expand in the next two
to three years. As a regular independent operator we have already made huge
strides towards achieving our goals."
Enquiries:
For further information, please contact:
Lonrho Africa Plc +44 (0) 20 7016 5105
David Lenigas, Chief Executive +44 (0)7881 825 378
Emma Priestley, Executive Director +44 (0)7867 785 177
Pelham PR
Charles Vivian +44 (0) 20 7743 6672
+44 (0) 7977 297 903
Candice Sgroi +44 (0) 20 7743 6376
+44 (0) 7894 462 114
10 July 2007
South African sponsor to Lonrho Africa Plc
Java Capital (Proprietary) Limited
Date: 10/07/2007 16:17:31 Produced by the JSE SENS Department.
