Shareholders of specialist engineering group Murray & Roberts (M&R) have approved a special resolution to grant financial assistance to its subsidiary OptiPower Projects, bringing relief to the company that recently lost a bid to recoup R25m from a client.
In a statement on Friday, the company said shareholders had approved the provision in the form of a guarantee for Optipower’s renewable projects, but did not mention the figure.
OptiPower Projects, which the group acquired in 2020, provides services to the energy transmission and distribution market.
However, the trading environment, characterised by delays in projects and slow rollout, has made it difficult for the group to benefit from the increasing investment activity in renewable energy projects in SA.
In the latest challenge facing Optipower, the Johannesburg high court last week dismissed its R25m claim for nonpayment for a wind farm built in the Eastern Cape.
Despite the parent company having its own operational conundrums to deal with in its other segments, after negotiation with the SA Lenders, in November 2022 the board announced M&R had successfully concluded the refinancing and upsizing of its existing SA debt facilities from R1.6bn to R2bn, giving it some flexibility to deal with any financing challenges.
Meanwhile, M&R has stumbled in its quest to regain control of its Australian asset, RUC Cementation Mining Contractors, after failing to ensure that certain conditions precedent in the deed of company arrangement (Doca) proposal to creditors were met on time.
The firm has said Cementation APAC — a new Australian-registered entity and a subsidiary of M&R UK which had been established and accepted as replacing MRPL as a proponent under the proposed Doca, will now be developed by the group with the intention of providing engineering and contracting services to mining clients in the Asia Pacific region.
The loss of RUC means that the group’s mining platform comprises only two regional businesses in Africa and the Americas, which had combined orders worth R14bn at the end of 2022.
M&R’s share price fell 5% to R0.95 on Friday.
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