The Public Investment Corporation (PIC) has increased its stake in PPC to just more than 25%, which means it now has negative control over the country’s largest cement producer and a controlling 66% of the second-largest Afrisam. Negative control means the PIC can block any significant transactions the PPC board wants to do. Such transactions usually require support from 75% of shareholders. This means an effective stalemate situation has arisen as more than 25% of PPC shareholders have indicated they will oppose a tie-up with AfriSam and the PIC is now likely to oppose any transaction that does not involve AfriSam.Chris Wood, head of equity at Prudential Investment Managers, which holds 14% of PPC and opposes the AfriSam deal, said a stalemate suited Prudential as it gave PPC an opportunity to realise some of its stand-alone potential. Wood said PPC had made significant investment in SA and the rest of Africa, which had the potential to double the company’s earnings and share price...

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