Cashbuild to acquire 60% of Allbuildco for R93m
Hardware and building material retailer Cashbuild has entered into a subscription agreement to subscribe for a 60% controlling interest in hardware retail chain Allbuildco for R93-million.
The transaction aligns with Cashbuild's strategy to become a market leader in the hardware and building material sector in South Africa across all Living Standards Measure bands.
Allbuildco will provide the growth platform for Cashbuild to target a customer base it has not previously served. Cashbuild aims to leverage its scale, experience and expertise to support the development of Allbuildco in line with the growth strategy for the business.
Specifically, Cashbuild will buy three Amper Alles hardware and building material stores – two in Silverlakes and Rayton, in Pretoria, and one in Groblersdal, in Limpopo.
The consideration will be funded from Cashbuild's cash reserves and banking overdraft facilities, it said.
The current private owners will hold the remaining 40% interest in Allbuildco and the current senior management of the three stores will continue to manage the businesses.
Further, Cashbuild and the sellers have agreed to a series of put and call options that are exercisable during the next five years, and which may result in Cashbuild acquiring a further 10% to 40% interest in Allbuildco. The consideration for these options has been capped, the company added.
The aggregate net profit after tax of Allbuildco is R12.8-million and the net asset value is R112.2-million according to the individual reviewed accounts of the sellers for the 12-month period ended February 28, 2024, the quality of which Cashbuild is satisfied with.
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