Keller Group PLC Acquisition of Esorfranki Geotechnical (0696Q)
October 09 2013 - 2:00AM
UK Regulatory
TIDMKLR
RNS Number : 0696Q
Keller Group PLC
09 October 2013
For immediate release Wednesday, 9 October 2013
Keller Group plc
("Keller" or "the Group")
Acquisition of Esorfranki Geotechnical, South Africa
Keller (LSE: KLR), the international ground engineering
specialist, announces that it has agreed to purchase the
Geotechnical Division of the Johannesburg-listed civil engineering
and construction company Esorfranki Limited (JSE: ESR) for an
initial consideration of R500m (GBP31m).
Esorfranki Geotechnical is the largest ground engineering
business in South Africa, offering design and build services to the
mining, civil engineering and construction industries, and has a
strong track record of executing projects in other Sub-Saharan
African countries. In the year ended 28 February 2013, Esorfranki
Geotechnical generated revenue of R788m (GBP49m), of which 46% was
earned outside South Africa, and an underlying operating profit* of
R53m (GBP3.3m). At 28 February 2013, the value of the gross assets
to be acquired was R630m (GBP39m) and the business had net assets
of R419m (GBP26m).
In addition to adding a market-leading business run by an
experienced management team who will remain with the business, the
acquisition will accelerate Keller's entry into selected
sub-Saharan construction markets, where significant growth is
expected over the medium to long term, fuelled by major
infrastructure and resources-related projects. The business will
form part of the Group's EMEA division.
The total consideration, to be paid in cash from Keller's
existing facilities, will comprise an initial payment of R500m
(GBP31m), on a debt and cash free basis, together with a maximum
deferred consideration of R150m (GBP9.4m) dependent on the
achievement of a certain level of profits over the three years
following the acquisition.
Completion is expected by the end of November 2013 and is
subject, inter alia, to approval by shareholders of Esorfranki
Limited at its general meeting on 18 November 2013 and the approval
of the South African Reserve Bank.
*: stated before a R24m (GBP1.5m) profit on the sale of a
property
Justin Atkinson, Chief Executive of Keller, said:
"This important acquisition marks another milestone in our
strategy of extending our global leadership by expansion into new,
higher growth regions.
"The combination of Esorfranki Geotechnical's local knowledge
and resources with Keller's scale, experience and broad range of
techniques will make us ideally placed to undertake complex major
projects requiring design expertise and multi-product solutions in
a region where we expect the longer-term opportunities to be
significant."
For further information, please contact:
Keller Group plc www.keller.co.uk
Justin Atkinson, Chief Executive 020 7616 7575
James Hind, Finance Director
Finsbury
Gordon Simpson, Rowley Hudson 020 7251 3801
Notes to Editors:
Keller is the world's largest independent ground engineering
specialist, providing technically advanced and cost-effective
foundation solutions to the construction industry. With annual
revenue of around GBP1.5bn, Keller has approximately 8,000 staff
world-wide.
Keller is the clear market leader in the US and Australia; it
has prime positions in most established European markets; and a
strong profile in many developing markets.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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