Steinhoff moves to acquire Illiad in R1.3bn deal
Furniture and household goods manufacturer and retailer Steinhoff International has made a R1.3-billion offer to acquire building materials distributor Illiad Africa. The acquisition would be carried out through a scheme of arrangement, with the offer price at R10 a share, plus a 24c special dividend to be paid by Iliad before the date on which the scheme would become effective. This represented a 24.6% premium to the 30-day volume-weighted average price calculated at the close of trade on 15 July and a 10.7% premium to the closing price of Iliad ordinary shares on 14 July.
“In recent strategic deliberations, the Iliad executive committee identified a number of potential synergies between Iliad and Steinbuild, a wholly owned subsidiary of Steinhoff.
The offer is, therefore, not only opportune, but presents various benefits for Iliad to capitalise on opportunities to increase scale and critical mass. “Iliad brings a nationwide footprint, the Buco brand and a skilled, experienced and well-respected management team to Steinhoff,” Iliad CEO Eugene Beneke noted. He added that there were a number of synergies between the companies, as Iliad and Steinhoff operated similar businesses, using similar sales channels, in complementary geographical locations across South Africa.
Beneke further pointed out that the companies also shared similar strategic challenges and long-term opportunities. “Iliad is at a point in its history where it is ready to grow and expand exponentially. This is an exciting development not only for the company but for the employees who will be part of a broader and more diverse group with all the opportunities that offers,” he said.
Source: Engineering News (Edited)