CAPE TOWN – Beleaguered construction group Aveng has sold its Aveng Duraset Alrode engineering supplier operation for R50 million in cash as part of its strategy to reduce debt and dispose of non-core assets.
Aveng chief executive Sean Flanagan said in a statement yesterday they had entered into a binding agreement to sell Duraset Alrode to Videx Wire Product, subject to certain contractual conditions.
Duraset Alrode is a diversified supplier of engineered support solutions to the mining and geotechnical industries and a leading supplier of critical safety products to the mining industry.
Videx has been a leading manufacturer and supplier of roof support systems and ventilation ducting for the mining industry since 1984.
The sale is expected to be completed by October 31.
Aveng management have been simplifying and optimising the portfolio of core businesses due to the challenging market environment in many of the sectors the group operates in and reduced infrastructure investment in the country.
The disposal of non-core assets was aimed at improving revenue growth and the profitability of the group.
Since August 2018, Aveng has disposed of non-core property assets and businesses which include Aveng Water, Aveng Rail, Aveng DFC, Aveng Infraset and most recently the announcement of the sales of Aveng Rand Roads and the Ground Engineering businesses.
Aveng shares traded between 2c and 3c a share yesterday, before closing at 2c.
Ten years ago it was trading at more than R40 a share.