Lucas Tseki, Southern Palace CEO, comments: “This acquisition is a continuation of Southern Palace’s strategy to be a leading, black-owned, industrial operating company particularly in the infrastructure, mining services and value-added steel manufacturing industries. Steel is in the fabric of Southern Palace, the group having been involved in the steel services business as an investor for the past 15 years. It is important for us to leverage this heritage, the experience we’ve gained over the years and to tap into the vast networks and connections we’ve built up, in order to grow Genrec in South Africa and the rest of the continent.”
In addition to the acquisition, the company is investing further capital to modernise the Genrec business and to ensure that it is sufficiently capitalised to take advantage of the group’s new business strategy.
“Southern Palace is truly stepping up its investment in the infrastructure industry. This acquisition ensures that we have a strong foothold in the steel fabrication market in South Africa. We plan to diversify the current Genrec product offering to become a significant steel provider for infrastructure developments in energy, water, mining, health, education and transport sectors,” adds Tseki.
Henry Laas, group chief executive, Murray & Roberts comments: “Genrec was the last remaining manufacturing business in the group’s portfolio of businesses. We believe that the sale of Genrec supports the group’s long-term strategy and that it is in the best interests of Genrec, as the business will now have greater opportunity to unlock order book potential in the public sector.”
Due to the nature and size of the transaction between Southern Palace and Genrec, it is deemed a large merger by the Competitions Commission. The deal is expected to be concluded in the next three months, pending approval by the Competition Commission.
