Shipping and logistics group Grindrod has been a big spender on infrastructure for some time. Growing its network of port and rail operations allows the group to diversify away from international shipping, a notoriously cyclical business.
Alan Olivier, Chief Executive of Grindrod says the company will raise R4bn to put into infrastructure development in Africa. Image: Grindrod
With many important rail and port facilities spread throughout Africa, where infrastructure development is generally poor or non-existent, Grindrod often has to invest in and build, or improve, the facilities it needs.
This makes the whole transport process - which often starts in coal or iron ore mines and ends with the raw materials on Grindrod vessels being exported overseas - more efficient.
Grindrod's board agreed at the end of last month to raise R4bn via an equity issue, about three-quarters of which will be spent on infrastructure development.
Chief Executive Alan Olivier says this will result in the group spending about R10bn on infrastructure over the next three years. "The company has a significant pipeline of expansionary capital projects," he says.
Much of the immediate capital spending is likely to be on rail development, though further expansion at the Maputo and Richards Bay coal terminals has been mentioned. Also under consideration are the bulk liquid and oil storage facilities at Saldanha Bay and Coega.
The remainder of the R4bn equity funding will be used on rearranging Grindrod's BEE structure, initially by buying-back the interests of empowerment partners Calulo and Solethu, and then setting up a new BEE transaction which will include JSE-listed Brimstone in the new consortium.
After the deal is wrapped up - the target is the end of next month - the new BEE grouping will own 8,5% of Grindrod, at the listed group level.
At the conclusion of the BEE deal, Grindrod minority shareholders will be offered a claw-back to purchase Grindrod shares from Grindrod and major shareholder Remgro
I-Net Bridge For more than two decades, I-Net Bridge has been one of South Africa’s preferred electronic providers of innovative solutions, data of the highest calibre, reliable platforms and excellent supporting systems. Our products include workstations, web applications and data feeds packaged with in-depth news and powerful analytical tools empowering clients to make meaningful decisions.
We pride ourselves on our wide variety of in-house skills, encompassing multiple platforms and applications. These skills enable us to not only function as a first class facility, but also design, implement and support all our client needs at a level that confirms I-Net Bridge a leader in its field. Go to: http://www.inet.co.za
LEGAL DISCLAIMER: This Message Board accepts no liability of legal consequences that arise from the Message Boards (e.g. defamation, slander, or other such crimes). All posted messages are the sole property of their respective authors. The maintainer does retain the right to remove any message posts for whatever reasons. People that post messages to this forum are not to libel/slander nor in any other way depict a company, entity, individual(s), or service in a false light; should they do so, the legal consequences are theirs alone. Bizcommunity.com will disclose authors' IP addresses to authorities if compelled to do so by a court of law.
ARE YOU AN INDIVIDUAL BUSINESSMAN OR A BUSINESS ORGANISATION THAT WISHES TOEXPAND IN BUSINESS, WHY NOT SOURCE FOR BG/SBLC FROM FELIX BURKE BROKERS WHOHAVE BG/SBLC SPECIFICALLY FOR LEASE AT A LEASING PRICE OF 5+2 OF FACE VALUEISSUANCE BY HSBC LONDON/HONGKONG OR ANY 25 TOP AA RATED BANK IN EUROPE,MIDDLE EAST OR USA. WE ALSO SECURE FUNDING PROJECT LOANS FOR 3% APREMAIL: email@example.comCONTACT: FELIX BURKE TEL: +44-742-437-0688, +44-7920720215.