Southern Palace Group today, 30 October 2017, announced it has signed an agreement to acquire 100% of Genrec Engineering, a steel fabrication and manufacturing business, from Murray & Roberts.
“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,” comments Lucas Tseki, Southern Palace Chief Executive Officer.
Southern Palace Group has been growing consistently and this move in the steel fabrication industry will further boost its capabilities and present long-term sustainable growth potential to the Group. 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.
“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,” says Henry Laas, Murray & Roberts Group Chief Executive Officer.
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.
Southern Palace is a wholly black-owned and managed South African, diversified industrial operating company with interests in numerous well-established businesses.