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Bidvest on the hunt for acquisitions - CEO

Johannesburg - Bidvest Group, the South African industrial company that spun off its food-services unit this year, is seeking acquisitions both locally and internationally and has the ability to borrow funds to finance deals, chief executive officer Lindsay Ralphs said.

“We are very lowly geared, we have a very strong balance sheet and I think we can look forward to some further growth going forward, both organic and acquisitive,” Ralphs said on a conference call with reporters on Monday.

“There’s quite a lot of activity in the market at the moment. A lot of the private equity companies are coming to the end of their funds and there a number of nice potential opportunities available in South Africa.”

After the separate listing of spun-off company Bid Corp, Johannesburg-based Bidvest is left with operations that range from car rental and freight services to electrical-equipment distribution.

The company will seek “bolt-on” acquisitions across all of its seven divisions, said Ralphs, who took the helm from founder Brian Joffe in May after the unbundling of the food-services unit.

Earnings before interest, taxes, depreciation and amortization rose 3.9% to R7.3bn ($505m) in the year through June, Bidvest said in a statement, while net debt fell to R5bn from R7.8bn by the end of the 12-month period.

The shares gained 0.3% to R154.16 as of 11:45 in Johannesburg, valuing the company at R52bn.

‘Creditable Results’

Bidvest has already announced one sizeable purchase since the separation with Bid Corp., agreeing in June to buy Brandcorp Holdings, a distributor of products from power tools to camping equipment, from Ethos Private Equity and management.

Bidvest’s headline earnings per share, which exclude one-time items, rose 2.5% to R10.54 for the year through June, excluding the spun-off assets. Revenue gained 3.6% to R68.2bn.

Trading profit at the commercial-products unit, which includes catering equipment and the distribution of Nissan Motor forklifts products in South Africa, increased by 42%, while financial services rose 10 percent.

“The group has delivered creditable trading results against the backdrop of challenging market conditions in the southern African region,” the company said. “Bidvest’s internal divisional restructuring and the unbundling of the food services unit has positioned the group well for its next growth phase.”

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