Cargo buys Zambian carrier
Business Day - Jun 8th 2012, 08:29
Logistics firm Cargo Carriers said yesterday it had bought 55% of BHL, a Zambian-registered transporter of commodities including copper concentrates, lime and sulphuric acid.
The purchase price of $2,2m will be settled by an upfront payment of nearly $1,5m, and two annual payments of $352000 based on a target of $1m after tax profits a year for the next three financial years.
The group said yesterday the final purchase consideration might be adjusted up or down, provided the total amount payable does not exceed $4,4m. It said any adjustment, whether through additional payments or refunds to the company, would be settled over five years.
Cargo Carriers provides logistics, transport, aviation charter and related information technology services to customers in sub-Saharan Africa.
BHL, based in Ndola, provides total logistics solutions within Zambia and sub-Saharan Africa to the mining, manufacturing and agricultural sectors.
It conducts most of its business in Zambia, the Democratic Republic of Congo and Namibia.
Cargo Carriers said its growth objective included growth by acquisition and risk diversification in neighbouring countries.
The BHL transaction expanded its ability to provide logistics solutions on the sub-continent and enabled it to take advantage of the boom in Zambian mining.
It said there were significant growth prospects in both the African mining and industrial sectors, and it was acquiring a well-established business with long-term contracts and proven management team.
Last month, the group reported 8,7% growth in revenue to R594m for the year ended February, despite the poor global economic climate.
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