Imperial Logistics ventures into R633 million Namibian acquisition
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IMPERIAL Logistics shot up 4.17 percent on the JSE yesterday after the listed transport and mobility group said it would build its cold-storage transport capacity through the R633 million acquisition of Deep Catch Namibia.
The shares showed a 32 percent gain to a year ago. The price, however, fell back slightly to R49.85 after midday.
Deep Catch wholesales, distributes and provides cold storage transport of perishable foods, mainly poultry, fish and dairy products, in Namibia and in the broader Southern Africa region.
It employs more than 480 people and serves customers in the wholesale, hospitality and retail sectors. The company has three commercial cold storage warehouses in Namibia and South Africa. The business also owns a majority stake in one of the largest freight forwarding businesses in Namibia.
The stake in Deep Catch Namibia was acquired from Salt Capital Ventures Limited and DEG – Deutsche Investitions und Entwicklungsgesellschaft, and management shareholders Christoph Kubirske, Jared-Dwight Geyser and Lewton Geyser. Imperial said the deal was in line with its “Gateway to Africa” strategy and provided the group with the opportunity to increase its reach into the consumer market, and expand its footprint with new capabilities on the African continent.
Imperial said Deep Catch's cold chain capability and network would allow it to enter and hold on to its expansion in its existing
markets of operations in sub-Saharan Africa, where there was substantial demand for affordable protein products. “This acquisition will provide access to defensive, value-added capabilities in FMCG, such as re-packaging,” Imperial's management said.
In addition, the acquisition would provide an opportunity to expand Imperial's reach to new customers and principals in other markets.
The management shareholders would be paid N$162 million, in three equal tranches when the audited annual financial statements of Deep Catch for the 2022, 2023
and 2024 financial years were completed, assuming targeted earnings before interest tax, depreciation and amortisation (Ebitda) were met.
Deep Catch's net asset were valued at N$287.6m. The value of the net assets of Deep Catch as at June 30, 2020, was N$287.6m.
Its revenue, Ebitda and taxed profit were N$1.04 billion, N$100.8m, and N$21.9m respectively, for the year to June 30, 2020.
In July last year Imperial started operating within two overarching solutions – market access and logistics – and was categorised into three businesses: Market Access, Logistics Africa and Logistics International.
The group said in its 2020 annual report that it aimed to be the strategic partner of choice for multinationals seeking access to Africa's growth and development opportunities, and providing access to selected markets that were growing trade flows into and out of Africa.
Healthcare and consumer sectors in Africa are expected to grow by a five-year compound annual growth rate (CAGR) of 18 percent and 9 percent respectively, the group said.
Imperial shares closed 1.18 percent lower at R49.52 on the JSE yesterday.