Consolidated Infrastructure's bright performance ignored by market
Behind CIG's strength lies huge foreign money, governmental and private
A year ago Consolidated Infrastructure Group (CIG) CEO Raoul Gamsu made a bold statement. CIG was, he said, “preparing to enter an organic growth and investment cycle that could transform the group”. CIG is no stranger to bold transformational moves. The first came in 2008 when it acquired electrical infrastructure project specialist Consolidated Power Projects (Conco). It was the decisive factor in CIG’s exceptional growth, in the past five financial years to August, its revenue has grown by 295% and headline EPS (HEPS) by 225%. CIG made its next decisive game-changing move in August when it announced it was to acquire full control of pre-paid electrical meter group Conlog. By far CIG’s biggest acquisition yet, Conlog came with an initial cash outlay of R700m and, based on Conlog’s 2016 results, a maximum potential price tag of R850m.
It was a big move for a company which has said it does not want excessive debt “handcuffing the business”. CIG turned to shareholders to fund t...
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