Imperial is pleased to advise that it has entered into an agreement to purchase 100% of the issued share capital of the J&J Group for an enterprise value of USD300 million (c.ZAR4.4 billion).
The J&J Group offers end-to-end logistics solutions along the Beira and North-South corridor, specialising in the transport of break-bulk, containerised, project, fuel and out-of-gauge cargo between Mozambique, Zimbabwe, Zambia, South Africa, Malawi and the DRC.
"This acquisition is in line with Imperial's 'Gateway to Africa' strategy as it will optimise and expand Imperial's reach in Africa by providing scale in end-to-end cross border transportation services in key African countries and new industries through well-established routes on the Beira and North South corridors, port capabilities, a developed asset base including fleet and 45,000m2 of warehousing space, and an entrenched customer portfolio," says Mohammed Akoojee, Group CEO at Imperial."The J&J Group's strategic asset base will complement Imperial's asset-right focus and will serve to further expand the Group's access to critical trade networks, consolidating Imperial's leverage and reach on the African continent."
The acquisition will contribute to Imperial's geographic and capability enhancement by granting Imperial access to new regions and corridors that will offer added benefits to the Group's logistics and market access offerings. This will position Imperial for quicker go-to-market outside of South Africa and will provide the Group with end-to-end access to certain key countries and corridors (port to customer) in Africa.
The transaction will be funded out of cash resources and existing debt facilities and will take place in three tranches, with Imperial initially acquiring 51% of the shares of the J&J Group. This will be followed by second and third tranches of 46.5% and 2.5% respectively. Conditions precedent for the three tranches are detailed in the regulatory SENS announcement: https://www.imperiallogistics.com/sens.php
"We are excited for J&J to partner with Imperial and believe that the operations of these two businesses are very complementary. This combination offers existing and potential J&J clients a true gateway to Africa," explained Carlyle and Ethos Private Equity, control shareholders of the J&J Group.
The J&J Group provides access to a management team which collectively has 95 years of industry experience and a wealth of experience in transportation services in complex African markets, using leading technologies, processes and systems. In addition, the J&J Group has implemented leading environmental, social and governance (ESG) practices in its key markets, which bodes well for Imperial's ESG aspirations.
The acquisition of the J&J Group is subject to the fulfilment of regulatory and other outstanding conditions. In light of the recent announcement regarding the proposed acquisition of 100% of Imperial's shares by DP World Logistics FZE (DP World), DP World's consent to conclude the acquisition of the J&J Group was obtained.
Click here to read the regulatory SENS announcement that includes more information about the acquisition of the J&J Group.