M&R gets more of Gautrain

Murray & Roberts (M&R) announced yesterday that it has concluded an agreement to increase its stake in Gautrain operator Bombela Concession Company (BCC) to 50%.

The R405 million transaction will increase M&R’s stake in BCC from the current 33%. The group hopes to finalise the matter before the end of the calendar year.

The transaction follows the settlement of disputes related to the Gautrain construction late last year, after which French construction group Bouygues Travaux Publics SAS and rolling stock supplier Bombardier Transportation UK indicated they would divest from BCC. Each held 8.5% of the shares.

M&R spokesperson Ed Jardim says BCC has so far delivered a return on investment of about 18% per year. The concession period ends in 2026 and until then the investment will provide a steady income.

The group stated the acquisition is being undertaken as part of M&R’s broader capital allocation strategy, as the investment in BCC provides strong returns in the short- to medium term, while it continues to look for potential acquisitions that would complement its three operating platforms.

Once all agreements have been signed, implementation of the transaction remains subject to approval from the Gauteng Management Agency, Competition Authorities and BCC’s funders.