PPC reaches further milestones in de-gearing its South African balance sheet
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THE COMPLETION of the sale of PPC Lime and PPC Aggregate Quarries Botswana (PPC AQB) was an important and positive step in the company’s ongoing capital restructuring and refinancing project, the group said yesterday.
The cement-making and related products company said that the conditions precedent for the two disposals had been met on September 15, earlier than the anticipated date of December 31, 2021.
PPC had said in May this year that it planned to sell PPC Lime, while on June 8 it said a deal had been reached to sell PPC AQB to a construction and mining company in Botswana.
The net proceeds from the sale of PPC Lime and of PPC AQB would be applied to de-gear PPC’s South African balance sheet, the group said.
PPC intends to release further details on the restructuring and refinancing project as well as a trading update on or about September 29.
PPC Lime, a solid performer in the PPC group previously, was sold to the global commodities trader and mining and steel group IMR along with a consortium of investors for R 515 million.
PPC’s share price fell 0.52 percent to close at R3.80 on the JSE yesterday. Although the current price was well up from 56 cents a year ago, the price has historically traded much higher, at around R9 in 2019.
Restructuring, and the benefits of relatively fast-growing sales in the past year, saw the group reduce its debt of R5.8 billion in 2019 to R2.6bn at the end of March.
The restructuring was necessary after expansion into the rest of Africa to offset weak demand in South Africa began to sap the group’s financial resources.