Esorfranki had disposed of its geotechnical business to UK-based Keller Holdings, one of the world’s largest independent ground engineering specialists, for R500 million, the JSE-listed civil engineering and geotechnical group said yesterday.
The sale encompassed the geotechnical business conducted by Esorfranki Construction, the shares of 10 of its subsidiaries, and the business conducted by Esorfranki Construction in Angola and Frankipile Mauritius International in the Indian Ocean islands.
Esorfranki and Esorfranki Construction had agreed to change their names to exclude the word “Franki” and the company would revert to its original listed name of Esor.
The effective date for the name change has yet to be announced.
Esorfranki and Esorfranki Construction are subject to a 60-month restraint of trade. Esorfranki said the rationale for the disposal was that the geotechnical market in South Africa and its share of that market had been relatively flat over the past few years.
Its board considered it to be in the best interest of shareholders to sell, given the disposal opportunity and purchase consideration.
Esorfranki’s strategy was now to maintain growth in the existing construction area of pipelines and the developments division, while the civils division was being right-sized to take advantage of anticipated government growth initiatives.
Esorfranki shares lost 6.11 percent to end at R1.69 on the JSE yesterday. – Roy Cokayne