Sabvest’s 49%-owned subsidiary, Apex Partners, has snatched a stake of 8.54% in mining engineering services specialist DRA Global — which is listed on the Australian Stock Exchange and the JSE.
16 December 2022 - 13:04
by Marc Hasenfuss
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Investment company Sabvest Capital is enjoying a flurry of deal-making towards the tail-end of the year — this time a foray into the mining industry.
On Thursday Sabvest’s 49%-owned subsidiary, Apex Partners, announced it had snatched a stake of 8.54% in mining engineering services specialist DRA Global — which is listed on the Australian Stock Exchange and the JSE. The deal follows Sabvest’s recent new investments in liquor group Halewood and pet supplies group Valemount as well electrical group ARB Holdings at the start of the year.
The transaction terms will result in Apex taking 4.65-million DRA Global shares that were held in treasury at R20 a share — giving the buy-in a value of about R93m.
The sale of treasury shares means DRA Global will enjoy a welcome inflow of fresh capital, but the number of shares in issue will not increase and dilute existing shareholders.
DRA Global has kept a low profile since listing on the JSE in July 2021. But the group has been busy in SA of late — completing the Limpopo Iron Ore EPC project, upgrade projects for Anglo Platinum’s Unki and Modikwa mines as well as completing the Elandsfontein Phosphate Mine restart.
New projects secured by the group recently include work on Platreef’s plant and infrastructure project, Anglo American Platinum’s Der Brochen Mine, Northam Platinum’s Zondereinde underground mine EPCM, Gerald Metals’ Marampa Mine and South32’s Wessels North Block EPCM.
In its results for the half-year to end-June, DRA Global indicated that its strategy of diversifying and expanding service offerings in the Americas continued, with project work won at the Adventus Mining Curipamba plant in Ecuador and the Antamina Mine in Peru.
The interim results, though, saw DRA Global posting a 16% drop in revenue to A$477m and an Ebitda loss of A$14m (2021: Ebitda of A$32.5m). The group, however, held net cash of A$72.5m (R851m) and a net asset value of A$5.11 or about R60 a share.
Apex is well versed in industrial businesses — already holding stakes in equipment distribution, industrial products and engineering solutions to the mining, energy, automotive and infrastructure sectors. The group’s better-known operations include Gabriel, ET-X Projects, ELB Equipment, Elephant Lifting and Tractor & Grader Supplies.
Apex CEO Charles Pettit said the R93m investment demonstrated confidence in DRA Global and its management as well as the revised strategy of the business after recent rationalisation.
In September DRA Global sold G&S Engineering Services and G&S Support Services to earn net proceeds of A$3.4m (about R40m).
Pettit told Business Day Apex might look to buy more DRA Global shares on the market but would not rush the process as there was a lack of share liquidity.
In 2020 Apex was involved in the buyout of listed engineering group EL Bateman — which also has interests in mining services — after steadily building up a stake in that business.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Sabvest mining a rich deal seam in 2022
Sabvest’s 49%-owned subsidiary, Apex Partners, has snatched a stake of 8.54% in mining engineering services specialist DRA Global — which is listed on the Australian Stock Exchange and the JSE.
Investment company Sabvest Capital is enjoying a flurry of deal-making towards the tail-end of the year — this time a foray into the mining industry.
On Thursday Sabvest’s 49%-owned subsidiary, Apex Partners, announced it had snatched a stake of 8.54% in mining engineering services specialist DRA Global — which is listed on the Australian Stock Exchange and the JSE. The deal follows Sabvest’s recent new investments in liquor group Halewood and pet supplies group Valemount as well electrical group ARB Holdings at the start of the year.
The transaction terms will result in Apex taking 4.65-million DRA Global shares that were held in treasury at R20 a share — giving the buy-in a value of about R93m.
The sale of treasury shares means DRA Global will enjoy a welcome inflow of fresh capital, but the number of shares in issue will not increase and dilute existing shareholders.
DRA Global has kept a low profile since listing on the JSE in July 2021. But the group has been busy in SA of late — completing the Limpopo Iron Ore EPC project, upgrade projects for Anglo Platinum’s Unki and Modikwa mines as well as completing the Elandsfontein Phosphate Mine restart.
New projects secured by the group recently include work on Platreef’s plant and infrastructure project, Anglo American Platinum’s Der Brochen Mine, Northam Platinum’s Zondereinde underground mine EPCM, Gerald Metals’ Marampa Mine and South32’s Wessels North Block EPCM.
In its results for the half-year to end-June, DRA Global indicated that its strategy of diversifying and expanding service offerings in the Americas continued, with project work won at the Adventus Mining Curipamba plant in Ecuador and the Antamina Mine in Peru.
The interim results, though, saw DRA Global posting a 16% drop in revenue to A$477m and an Ebitda loss of A$14m (2021: Ebitda of A$32.5m). The group, however, held net cash of A$72.5m (R851m) and a net asset value of A$5.11 or about R60 a share.
Apex is well versed in industrial businesses — already holding stakes in equipment distribution, industrial products and engineering solutions to the mining, energy, automotive and infrastructure sectors. The group’s better-known operations include Gabriel, ET-X Projects, ELB Equipment, Elephant Lifting and Tractor & Grader Supplies.
Apex CEO Charles Pettit said the R93m investment demonstrated confidence in DRA Global and its management as well as the revised strategy of the business after recent rationalisation.
In September DRA Global sold G&S Engineering Services and G&S Support Services to earn net proceeds of A$3.4m (about R40m).
Pettit told Business Day Apex might look to buy more DRA Global shares on the market but would not rush the process as there was a lack of share liquidity.
In 2020 Apex was involved in the buyout of listed engineering group EL Bateman — which also has interests in mining services — after steadily building up a stake in that business.
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