DP World to Buy Imperial Logistics in $890 Million Bet on Africa
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DP World plans to buy South Africa’s Imperial Logistics Ltd. for $890 million, in what the port operator said would be its most significant acquisition in Africa so far.
“Imperial’s business strongly complements DP World existing footprint in Africa and Europe,” the Dubai-based company said, adding that the deal demonstrates long-term confidence in the South African economy and the wider regional market despite recent challenges.
The announcement comes one week after DP World said it had acquired American logistics company Syncreon Holdings in a $1.2 billion deal. Syncreon ranks No. 36 on the Transport Topics Top 50 list of the largest logistics companies in North America.
RELATED: Port Operator DP World Buys Syncreon in $1.2 Billion Deal
The privately held company offered 66 rand ($4.60) per share, a 40% premium to Imperial’s last close. The shares surged as much as 36% on July 8, trading just below the offer price. Even with the rally, the stock still trades below a January 2018 high.
DP World is one of the world’s largest operators of marine ports and inland cargo terminals, stretching from gateways in London and Antwerp to hubs in Africa, Russia, India and the Americas.
It has been on an acquisition spree as it attempts to become a more diversified, integrated logistics company.
DP World also continues to look for ways to cut debt and is considering offering international investors a chance to buy into the Jebel Ali Free Zone, a prized asset that helped transform Dubai into a hub of global trade, people familiar with the matter have said.
Imperial, meanwhile, started as a small motor dealership in 1940s Johannesburg and now employs more than 25,000 people around the world. Under CEO Mohammed Akoojee, the firm has been looking to dispose of noncore assets and position itself as the gateway to Africa for transporting goods.
The company has also been awarded contracts by South Africa to import an unspecified quantity of coronavirus vaccine doses as the country battles one of the worst outbreaks on the continent.
The deal is expected to close by the first quarter of 2022.
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