Super Group shifts gear in Australia
IN its second major acquisition this year‚ transport logistics company Super Group says its Australian subsidiary SG Fleet will acquire vehicle finance provider NLC, which has its headquarters in Melbourne, for R2.03-billion.
This follows Super Group’s purchase of the controlling stake in German logistics firm IN tIME for R2.01-billion‚ which became effective earlier this month.
There are no conditions attached to the NLC deal‚ which Super Group plans to wrap up by the end of the month.
The stock jumped 4.26% on Tuesday‚ its biggest daily percentage gain this year‚ valuing the industrial group at R12.3billion‚ according to Iress data.
Although Australia made up just 7.7% of the company’s total revenue of R19.82-billion for the year ended June‚ the division sold double the number of cars than in South Africa‚ where consumers are under financial strain.
Figures released by the National Association of Automobile Manufacturers of SA this month showed new car sales fell 8.6% compared to a year ago and the outlook for the rest of the year remains relatively bleak.
In addition to exposure to the more robust Australian consumer‚ SG Fleet derives further benefit from the weak rand‚ which contributed R500 000 to total revenue in the 2015 financial year. The rand has lost 7.48% against the Australian dollar since January.
Super Group chief executive Peter Mountford said the NLC acquisition was expected to further enhance SG Fleet’s market share in Australia‚ where it has a strong foothold as the country’s second-biggest vehicle fleet management providers.
The transaction would also add about 20% to SG Fleet’s fleet size of more than 90 000 vehicles‚ Mountford said.
Super Group’s 54% holding in SG Fleet‚ which has a listing on Australia’s stock exchange, will be reduced to 52.1% to make way for the 9.1 million shares its subsidiary will issue to the sellers to finance the transaction.
The issued shares will be valued at R263.9-million. The rest of the transaction will be funded with R1.12-billion in new debt and R649.6-million from SG Fleet’s existing cash resources.
In September‚ ratings agency Standard & Poor’s affirmed Super Group’s long-term national rating of A+‚ indicating a strong capacity to meet its financial commitments. — BDLive