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SKJ
SKJ
Sekunjalo Investments Limited - Invests in automotive sector
Sekunjalo Investments Limited
(Incorporated in the Republic of South Africa)
(Company registration no: 1996/006093/06)
Share code: SKJ & ISIN: ZAE000017893
("Sekunjalo")
Press Release
Date: 02 August 2006
Sekunjalo invests in automotive sector
South Africa"s Top Empowered company in 2006*, JSE-listed Sekunjalo Investments
Limited (Sekunjalo) today announced its first investment into the automotive
sector via its wholly owned subsidiary Sekunjalo Motor Holdings.
Sekunjalo Motor Holdings has acquired a 10% stake in the Eastern Cape"s largest
DaimlerChrysler dealership, Ronnies Motors, and a 30% stake in TATA Mowbray
which holds the franchise for TATA Motors in the Southern Suburbs, for passenger
and light commercial vehicles.
Sekunjalo deputy CEO Norman Noland said the combined value of the two
investments is approximately R 12 million.
He said the automotive sector was an appealing investment for three key reasons.
"The first is that the automotive industry has been identified by Government"s
AsgiSA policy as a priority sector that is capable of underpinning significant
economic growth. It is a leading indicator of the health of the economy and a
sector to which we want exposure."
"The second reason is that there are real opportunities to cross-sell related
products originated by Sekunjalo"s Financial Services division. Buying a motor
car is as much about the financing and insurance requirements as it is about the
make or model, and we have the capability to deliver the financial services
products required at point of sale," Noland said.
"And the third reason is simply because of South Africa"s love affair with the
motor car. In part because of insufficient public transport, but equally
because of the status it affords, a motor car is one of the first major
purchases made by an individual. The growth in vehicle sales is mirroring the
emergence of a growing middle class in South Africa."
Ronnies Motors was started in 1948 and has branches in East London and King
Williams Town. The dealership specialises in Mercedes Benz, Chrylser, Jeep,
Dodge and Mitshubishi new passenger and commercial vehicles, and also has used
car and commercial vehicle divisions.
The TATA franchise has the license to sell passenger and light commercial
vehicles and will open its first showroom in early August with a sales outlet in
Mowbray and a large dedicated service and parts centre in Ndabeni.
"We"re launching a pincer attack on the vehicle sales market by entering both
the top-end luxury market and the affordable end of the market simultaneously,"
Noland said.
Tony Cotterell, representing Ronnie"s Motors said the investment by Sekunjalo
boosted the group"s existing broad-based BEE profile and presented significant
opportunities for future growth.
"We are privileged to have been chosen by Sekunjalo as its partner in the
Eastern Cape and Border areas and look forward to growing our relationship
further.
"We have identified and will exploit cross-selling opportunities, and further
growth options now open to us. At the same time our enhanced BEE profile will
enable us to maintain preferred supplier status with our customers, particularly
in the government / parastatal and fleet management markets," Cotterell said.
Greg Symonds representing the other shareholders in the TATA dealership says,
"We are pleased to have Sekunjalo as our empowerment partner. We fully endorse
Sekunjalo"s value system and have no doubt that because of its strategy of never
being a passive investor - Sekunjalo will add huge value in our partnership."
Norman Noland, Sekunjalo"s deputy CEO, said the two acquisitions announced today
would be followed by additional announcements from Sekunjalo Motor Holdings in
due course.
"This is a growth sector we"ve identified and we intend making our presence
felt," he said.
* In July Sekunjalo was awarded the Financial Mail Empowerdex South Africa"s Top
Empowered Company for 2006 award.
Ends
Prepared by: Bruce Hetherington
Beachhead Media & Investor Relations
Tel: (021) 487 9000
Cell: 082 458 2199
Contact: Norman Noland
Deputy CEO
Sekunjalo
(021) 702 7700
Zenariah Barends
Executive director, Sekunjalo Corporate Services
(021) 702 7700
082 441 0433
Date: 02/08/2006 09:12:08 AM Produced by the JSE SENS Department
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