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Macsteel Service Centre SA

7 Brook Road
Lillianton
Boksburg
Gauteng
1459
South Africa

Tel: +27 (0)11 871 0123

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Black-economic empowered diversified industrial holdings company, the Southern Palace Group (SPG), reported on Monday (19th Jan 2015) that it had entered into an arrangement to buy 100% of Macsteel Service Centres South Africa (MSCSA).

 

MSCSA is a leading supplier of value-added steel products and arguably one of the country’s largest privately owned businesses, which has been in operation since 1904 and supplies the full range of carbon steel, special steel, stainless steel, aluminium products and value-added steel processes to more than 10 000 customers in various industry sectors across sub-Saharan Africa.

 

The proposed transaction comes more than a year after a previous sale process was terminated and remains subject to a number of conditions, including a due diligence and approvals from certain regulatory authorities.

 

The previous disposal process, which was initiated in February 2013, reportedly attracted material domestic and international interest, with a select number of bidders chosen to participate in a due-diligence process.

 

However, in August 2013 MSCSA founder and majority shareholder Eric Samson terminated the process and indicated that he would remain invested in the company.

 

In a statement released by SPG on Monday, Samson expressed his support for the proposed transaction, saying: “This new arrangement is further to the intentions we expressed during 2012 and we are satisfied with the current process.”

 

Samson added that the prospective deal accommodated the best interests of all stakeholders and sustained the company’s empowerment credentials, which he described as being of “paramount importance to MSCSA”.

 

Besides Samson, his investment structures and management, MSCSA is currently 25.5% held by a black economic–empowerment consortium comprising Kagiso Trust Investments (7.5%), the Shanduka Group (7.5%), the Macsteel Employee Trust (5%), Peotona Development Investments (2.5%), Future Africa Investment Holdings (1%), Kheip (1%), representing the Sonn family, and Dr Len Konar (1%).

 

“Most importantly, the best interests of our loyal staff at all levels will be accommodated,” Samson added – the group employs over 5 000 people.

 

SPG executive chairperson Sello Mahlangu expressed his excitement at the prospect of acquiring the well-established “blue-chip” company.

 

“SPG looks forward to working towards the successful completion of the process, and thereafter, working with management and staff to build on what can only be described as a remarkable success story, well into the future, for the benefit of all stakeholders,” Mahlangu added.

 

Should it succeed in buying MSCSA, SPG will deepen its position in the Southern African steel sector where it already has a shareholding in the Scaw Metals Group.

 

But its investments also cover the automotive trading and manufacturing, logistics, real estate and telecommunications sectors and include positions in Growthpoint, MAN Truck and Bus Centurion, Altech Fleetcall, Altech Alcom-Matomo, Altech Motorola Radio Distribution, Canvas and Tent Manufacturing, and Huawei Technologies Africa.