JOHANNESBURG - Listed transport and mobility group Imperial Holdings yesterday announced the long-anticipated unbundling of its logistics and vehicle businesses, saying the move would provide direct access to the equity and debt capital markets and enable the two entities to raise funding independently.
Imperial said its board had approved the separation of Motus, its vehicle dealership division, into a separately-listed company and outsourced logistics service provider Imperial Logistics. The separation would enhance the units’ long-term fortunes.
It said it had secured sufficient commitments from funders regarding the necessary debt restructuring for Imperial Logistics and Motus to operate on a standalone basis after the unbundling.
Imperial said the implementation of the unbundling of Imperial Logistics and Motus would have self-sufficient capital structures, “with an optimal mix of debt and equity on a standalone basis and within the industries in which they operate, to facilitate growth, provide flexibility and maintain sufficient liquidity and headroom”.
In February Imperial announced that it had prioritised the self-sufficiency, independence and balance sheet capacity necessary for the logistics and automotive businesses’ respective growth strategies for the year.
The group reported an 11percent growth in group revenue to a record R66.5billion in the six months to December from R59.7bn. Imperial Logistics generated 41percent of the group’s revenue and 45percent of the group’s operating profit and motor vehicle group Motus the balance.
Operating profit increased 5percent to R3.1bn from R3bn, with the operating margin declining to 4.6percent from 4.9percent.
Yesterday the group said Osman Arbee would relinquish his role as chief executive of Imperial and would remain chief financial officer of Motus following the separation. Arbee replaced former Imperial chief executive Mark Lamberti, who resigned in April.
It said Marius Swanepoel would be chief executive of Imperial Logistics until his retirement in June next year, upon which Imperial chief financial officer Mohammed Akoojee would succeed him. In the meantime Akoojee would be appointed as (chief executive) designate of Imperial Logistics to facilitate an orderly transition and handover, the group said.
George de Beer would become Imperial Logistics chief financial officer, while Ockert Janse van Rensburg would remain chief financial officer of Motus.
The group said the transaction would not affect Imperial’s Ukhamba broad-based black economic empowerment (BEE) scheme, saying the existing BEE structure would be replicated to ensure that all shareholders in Ukhamba Holdings retained their economic rights.
Imperial said a shareholder general meeting to vote on the unbundling would be held on October 30. Imperial declined 1.76percent on the JSE yesterday to close at R196.16.