PLUMBING AND SANITARYWARE
Dawn moves to sell rest of GDW
Distribution and Warehousing Networks (Dawn) has signed a nonbinding memorandum of understanding with the controlling shareholders of Grohe Dawn Watertech (GDW) for the potential disposal of Dawn’s 49% holding in GDW.
The shareholders already hold 51% the business.
The JSE-listed construction and building materials group says there is no certainty the transaction will be concluded.
GDW houses the Cobra-branded plumbing products and Vaal sanitaryware.
Dawn delayed releasing its annual results on June 30, stating there was an "unexpected and material delay in the reporting of results by a major associate". It will now release its results on Friday.
If the proposed sale goes ahead Dawn will remain the long-term master distributor for the GDW product range in southern Africa. "There will be a lot more clarity on Friday," CEO Edwin Hewitt said on Tuesday.
The company has churned executives after it sold a 51% stake in GDW in 2014 for R880m cash. The stake was bought by Grohe, a German global sanitaryware firm, which had just been bought by Japan’s Lixil building products group.
In recent results, Dawn reported losses of more than R1bn amid the delayed approval of working capital. It subsequently closed a rights offer worth R358m to help turn around the group. It is now in a closed period, but said it would continue to take costs out of the business, close down warehouses and refocus itself.