Unitrans, Mvela unveil empowerment deal
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Transport group Unitrans surprised the market yesterday with the announcement of an empowerment deal.
Unitrans said its board had approved the sale of a 15% stake to a consortium of Mvelaphanda Capital and a yet-to-beformed employee trust .
The consortium will pay Unitrans R290,5m in cash for 11,6-million new shares that will be issued.
CE Jo Grové said the deal locked its new empowerment partner in for five years. The issue price of R25,04 a share represents a discount of 10% to Unitrans` weighted average share price of R27,82 for the 30 trading days up to August 6.
Another important change in Unitrans` shareholding could be on the cards. Murray & Roberts, which owns 44,7% of the company, said last week it was considering an offer from an undisclosed party for its stake.
A Murray & Roberts sale could trigger an offer to minorities. Under South African law, any shareholder buying a stake above 35% is required to make an offer to minority shareholders.
Grové said yesterday that Unitrans had not been given details of the offer.
Unitrans, one of the largest retailers of new and used vehicles, also reported a 20% jump in revenue to R9,3bn for the year to June compared with the previous financial year.
Operating profit rose 9% to R416,6m and headline earnings a share increased 13% to 346,7c a share. This was despite the negative effects of low inflation and the rand`s strength.
Grové said the group`s largest division, Motor and Financial Services, had an outstanding year, reporting a 21% jump in revenue to R7,1bn. `Retail has been absolutely phenomenal,` he said.
Unitrans has an estimated 8% market share of dealer sales in SA .
Grové said the struggling Hertz car rental business was still unprofitable. But the business recorded a considerable improvement in the past year, he said.
He said the group had identified an acquisition opportunity offshore, after saying earlier that it was looking at the UK, other parts of Europe and Australia.
With a 12% debt-to-equity ratio at year-end and strong cash level, the group said it was positioned for acquisitions.
Business Day
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