JSE-listed Altron is set to dispose of its battery unit, Powertech, to Trinitas for R300 million.
Trinitas is a black-empowered, independent private equity advisor, formed as a joint venture among the founding executives, Sasfin Bank and Peotona Group, to establish Trinitas Private Equity Fund. The founding executives of the Fund are Andrew Hall, John Stipinovich and Soteris Theorides, who have worked together as a private equity team since 2001.
The news comes after Altron, which is undergoing a turnaround, recently pointed out that the Powertech group, Altech Autopage and Altech Multimedia have all been classified as discontinued or non-core operations, while the continuing operations comprise the information technology and telecommunications businesses of the group.
Altron's turnaround strategy is bearing fruit, as the group saw headline earnings per share swing from a loss to a profit for the six months ended 31 August, despite revenue decreasing. "We are beginning to see the positive results of refocusing the Altron group in line with our stated strategy," CEO Robbie Venter said.
Powertech, via the Powertech Battery Group, manufactures and distributes a wide range of automotive batteries for the South African market. This includes two well-known battery brands in the automotive aftermarket sector namely Willard and Sabat Batteries. The Powertech's range of batteries extends to a wide variety of market sectors including; passenger and heavy duty vehicles, agriculture, leisure and marine.
In a statement, Altron says following strategic review sessions held at both Altron and Powertech during the past 12 months, the Powertech board, in conjunction with the Altron board, has determined that the Powertech is no longer a core asset for the Altron Group and accordingly should be disposed of to a third-party who will be better suited to further develop this business going forward and to extract value for shareholders.
The proposed transaction will become effective following the fulfilment of the last of the conditions precedent set out below and as detailed in the offer, the company adds.
The proposed transaction consideration will be payable as to R160 million on the effective date of the proposed transaction and R140 million which will be linked to and conditional upon actual receipts of automotive production development programme income from the effective date.
The proposed transaction consideration proceeds and cash realised will be used to reduce the overall Altron Group debt.
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