Johannesburg - The purchase of Stocks Civils by Wilson Bayly Holmes (WBHO), the construction firm, should be effected by the end of March, pending regulatory approval from the competition authorities, Brian Holmes, the chairman of WBHO, said yesterday.
WBHO issued a cautionary yesterday saying that negotiations referred to in announcements in November and December last year were still under way.
The acquisition is expected to boost turnover but not profitability.
WBHO is effectively buying out the shares in Clidet, which owns the firms operating the civil engineering business of Stocks Civils. The firm is being bought by WBHO, for the addition of resources rather than to boost profitability, for 1c.
WBHO will stand surety for certain loans and instalment obligations, which amount to R48 million of the business. The acquisition of this part of Stocks follows the delisting and reconstruction of the Stocks & Stocks group. The civil engineering and building businesses were disposed of separately.
Tom Hendry, the chief executive of Stocks Building Africa, has said that the purchase of Stocks Civil Engineering by WBHO had no relevance to or effect upon Stocks Building Africa, and that the company had no involvement in this deal.
Stocks Building Africa last year acquired the assets and liabilities of the building division of Stocks & Stocks Housing, MEI and Home for South Africa, as well as the shareholding in certain associated companies and joint ventures. The acquisition was made by a consortium comprising RMB Ventures, WIP Private Equity and senior management.
Hendry said that though conditions in the building industry were extremely competitive, the company was on line to achieve objectives and the order book was looking healthy in all regions.
WBHO's interims are due out at the end of next month. The firm's share price closed up 10c at R4,20.