Cashbuild has cleared all hurdles to acquire a controlling interest in Allbuildco Holdings, with the transaction set to become effective on December 1.
The building materials retailer announced its interest in acquiring a 60% stake in Allbuildco earlier this year. The R93m deal forms part of its strategy to serve a broader customer base across all income levels. In turn it said it would leverage its scale and expertise to grow the business once acquired.
The Competition Commission recently recommended the deal to the Competition Tribunal with no conditions, stating that it was unlikely to lessen or prevent competition and it did not raise public interest concerns.
The transaction would be funded through Cashbuild’s reserves and existing overdraft facilities, it said. It also secured future options to increase its stake by up to 40% over the next five years.
According to Cashbuild’s initial announcement, the targeted stores have an estimated adjusted net profit of R18.1m and a net asset value of R69.9m.
“After adjusting for inter alia income and expenses of the sellers not transferring to Opco and, similarly, assets and liabilities of the sellers that do not form part of the proposed transaction, the adjusted net profit after tax and the net asset value of the target stores to be delivered to Allbuildco on the effective date are estimated by Cashbuild to be R18.1m and R69.9m, respectively.”
Allbuildco, through its operating company, will own three hardware and building material stores now trading as Amper Alles in Silverlakes and Rayton in Pretoria, and Groblersdal in Limpopo. Cashbuild said the remaining 40% of Allbuildco will be retained by the current owners, the Blignaut family, with Braam and Hendrik Blignaut continuing to manage the stores.
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