GPI chairperson to step down amid drive to pay down debt
CAPE TOWN – Grand Parade Investments (GPI) non-executive chairperson Hassen Adams has elected to step down before the next annual meeting because of ill health, but will remain on the Burger King and SunWest boards.
At the annual meeting last week, shareholders voted in favour of a bid by Sun International to buy GPI’s remaining 30 percent stake in Sun Slots.
The shareholders voted by a majority of 66.64 percent in favour of the proposal, the proceeds of which would be used to pay down debt held against the shares and to pay a special dividend.
“Now that shareholders have voted for the Sun Slots deal, GPI will move to restructure its balance sheet by reducing debt, which will allow the company to revert to being dividend active,” Adams said in a statement.
He said at the meeting that the company would be returning to its roots as an investment company.
“GPI’s future is bright. Our focus on returning to being an investment company will re-rate our share price closer to our intrinsic net asset value.
"We continue to invest in people to ensure a well-developed staff complement that embraces 21st century applications, and with skills appropriate to execute our strategy,” he said.
He said in his chairperson's review that the economic climate had forced the company to embark on austerity measures that had seen a reduction of head office costs, the sale of non-core assets and increased productivity.
“In Burger King, we are continuously achieving this through the introduction of innovations such as self-ordering kiosks and have increased our revenue through home deliveries,” Hassen Adams added.
GPI was founded in 1997. The founding shareholders were made up of 20 000 individuals, predominantly from disenfranchised communities, who invested the seed capital of R28 million.
“Today, we are a multibillion-rand company that has since inception not required funding from its shareholders.
"During the 22 years of our existence, we have navigated GPI through hostile takeover attempts and challenges from fund manager activism.
"GPI has created exceptional value for its founding shareholders through its continuous growth and leveraging of our acquired businesses,” Adams said.
“We expect Burger King to also become a profitable leverage opportunity in the near future,” he added in the review.