Grindrod builds capacity with Swift acquisition
CAPE TOWN - GRINDROD subsidiary NovaTech, which trades as Hesper Engineering, a ship repair and general engineering company based in Cape Town, has purchased a 51 percent shareholding in Swift Engineering.
Swift Engineering, which will in future trade as SwiftNova Engineering, is a fabrication company servicing the marine, energy and oil and gas sectors in the Mossel Bay area and nationally, a statement from Grindrod said yesterday.
Grindrod said the acquisition was expected to strengthen the capabilities of Sturrock Grindrod Maritime’s (SGM) Technical Division, which comprises Hesper Engineering, Nova Marine and United Container Depots.
SGM Technical chief executive Marcus Twine said the relationship between Hesper Engineering and SwiftNova went back many years and talks about a potential partnership that began at the start of 2020.
“We were open to it because we are always on the lookout for complementary opportunities to grow our business with partners that uphold similar values. Director Danie Otto and his team are established and respected in the construction community,” said Twine.
When SGM and Nova group joined forces in 2018, Andrew Sturrock, chief executive of Sturrock Grindrod Maritime, said the strategy was to strengthen their position in the niche technical market.
“With the addition of SwiftNova, we can leverage off their respective sales and service agreements and ultimately offer one-stop technical solutions to our clients,” he said.
SwiftNova’s expertise lies in steelwork, pipe fabrication, corrosion protection, design and diverse projects, which sits in the same service pool as Hesper Engineering.
SwiftNova was established in 1982 to seize opportunities from the development of the oilfields in Mossel Bay when news broke of major offshore developments that resulted in the PetroSA GTL (gas-to-liquid) refinery.
Its clients include state-owned entities such as PetroSA, GTL and Logistics, Offshore/Onshore, oil majors Shell SA, Total, Astron Energy, Engen SA as well as international shipping companies.
Meanwhile, NovaMarine recently acquired its South African National Accreditation System Certification for inspection of Transportable, Refillable Gas Containers, which includes approval as a high pressure test station for testing CO₂ cylinders.
While the national lockdown affected most industry sectors due to the Covid-19 pandemic, NovaMarine was earmarked as an essential services provider during this time and extended its service offering to include a sanitising service for vessels.
Grindrod’s headline earnings slumped to R23.4 million in the six months to end-June 2020 from R165.5m the same time a year before, this after Covid-19 lockdown impacted significantly on its continuing businesses, costs were cut and the weak macro economy resulted in fair value losses in the private equity investments. All its businesses resumed operating from June.
At the end of December, Grindrod announced the sale, via subsidiary Grindrod Trading Holdings, to Agribel Holdings, of its entire shareholding in 111-year old Senwes, comprising some 37.4 million shares, for R385.2m cash.
The sale was done because Senwes, which develops access to markets for agricultural produce and the supply of input products to agricultural producers, was no longer considered an area of strategic focus by Grindrod.
Grindrod shares rose 1.09 percent on the JSE yesterday to close R4.65.