ARB subsidiary buys Industrial Cable Suppliers
ARB Electrical, a subsidiary of ARB Holdings (ARH), and an independent distributor of electrical products – such as power cables, overhead line conductors and equipment – has concluded the purchase agreement for Industrial Cable Suppliers (ICS).
The purchase price, payable in cash, is based on a premium of approximately 14.7% to the net tangible asset value of ICS.
ARB Electrical and the ICS vendors – consisting of DSC Investment, Sasfin Private Equity Investment Holdings and Neville Nathan Kobrin – have agreed that the share purchase price will not exceed R55 million, taking into consideration the current claims on shareholders’ loan accounts of R3.33 million.
Kobrin, the incumbent MD of ICS, has entered into an employment and/or consultancy agreement with ICS from the effective date for a period not exceeding 12 months, in order to facilitate a smooth handover of the operations to ARB Electrical.
ICS, an independent specialist distributor of low-, medium- and high-voltage power cables and electric wire products, will become a subsidiary of ARB.
Through its two strategically-located branches in central Johannesburg and in Rustenburg, ICS supplies the mining sector, local industry, electrical contractors and other electrical wholesalers.
ARB says that ICS is a natural fit for the group given its strong reputation, operational similarity and strategic geographic footprint. It aims to further establish itself within the mining sector, and would extend ARB Electrical’s national branch network to 17 branches across SA.
“ARB is of the view that the ICS acquisition will be earnings- and value-enhancing from the outset,” it said.
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