Johannesburg - Labat’s R627.5 million purchase of logistics company Reinhardt Transport Group (RTG) is closer to being completed, with only three conditions outstanding.
The purchase will effectively result in a reverser takeover of Labat, which a few years ago was battling financially. Labat was at one stage a technology company, but then explored playing in the mining field and is now an investment holding entity.
It told shareholders this morning all the necessary conditions for the reverse takeover had been met, barring approval from shareholders, the JSE and the Competition Commission.
Given the size of the transaction, the deal is also likely to have to meet with the Competition Tribunal’s approval.
In terms of the deal, Labat will spend R627.5 million in cash to buy RTG’s brands, business and assets.
Labat has noted that RTG has a “ dynamic and experienced management team” as well as a “wish to succeed”. “There is every reason to expect that RTG will achieve even greater success in the future and continue to grow.”
The listed company adds RTG is “well established and recognised within the transport market and is seen as one of the largest privately owned logistic businesses in South Africa.”
RTG owns Reinhardt Transport, Chrome Carriers and the dormant Amalgamated Bulk.
Labat, which turned over R12 million in the year to February and reversed its previous loss-making position, notes RTG will add to its revenue.
RTG expects to turnover more than R1.5 billion in the year to June, while earnings before interest, tax, depreciation and amortisation should be around R338 million. Net profit is expected to come in at R100 million.
Once the deal is complete, Labat will request a transfer to the main board.
IOL