AFGRI to acquire MGK's grain management business
AFGRI's (AFR's) wholly owned subsidiary AFGRI Operations is to acquire the grain management business of MGK Bedryfsmaatskappy Eiendoms Beperk conducted at silos in Pretoria West‚ Brits‚ Northam and Battery as a going concern and will lease the silo complexes from MGK.
The purchase price is R12m.
Afgri said in a statement on Monday that the business has been identified as a valuable strategic asset which fell within the group's growth strategy to expand its core grain management capacity.
The transaction will increase AFGRI's grain storage capacity by 165‚000 metric tonnes to 4.471-million metric tonnes.
The monthly lease payment for the Silo Complexes is R1.1m‚ which will escalate annually in line with the consumer price index.
The deal is subject to conditions including the approval of the South African competition authorities.