Murray & Roberts has entered into an agreement with Firefly Investments for the sale of the Murray & Roberts Infrastructure and Building Platform (MRIB) for R314 million.
Firefly Investments represents a consortium led by Southern Palace, a black-owned industrial group, which includes the Government Employees Pension Fund (GEPF) and members of MRIB’s management as shareholders.
The transaction comes as South African engineering and construction group Murray & Roberts plans to become a diversified project engineering, procurement and construction group in selected natural resource sectors.
Murray & Roberts said the transaction is the first to effect transformation by establishing a large black-owned and controlled infrastructure and building business.
The company will dispose of its shares in Concor to Firefly Investments for an aggregate disposal consideration of R314 million. At the closing date of the transaction, MRIB will be owned by Concor, a wholly owned subsidiary of Murray & Roberts.
This transaction excludes the Murray & Roberts investment in the Bombela Concession Company (BCC), Bombela Civil joint venture (BCJV) and Bombela Operating company, as well as the operations in the Middle East, where current projects are expected to be completed by December 2017 and no new projects are being pursued.
The new strategic future
The group continues to implement its new strategic future plan and the three multinational business platforms provide a strong base for future growth.
The three key strategic drivers are: global economic growth, global population growth, and continued urbanisation, which will provide the basis for sustainable growth in natural resources markets over the long term.
It is the group’s vision, by 2025, to be a leading multinational group that applies its project lifecycle capabilities to optimise fixed capital investment.
Murray & Roberts aims to achieve this by focusing its expertise and capacity on selected oil and gas; metals and minerals; and power and water market sectors.
Growing its capability in specialist engineering, commissioning and asset support and maintenance services in these market sectors, should yield higher margins and carry lower risk than services only provided in the construction segment of the project value chain.
This diversification is aimed at enhancing return to shareholders.