Prudential opposes AfriSam, PPC deal
‘Shareholders have been asked to back a short-term gain,‘ says Prudential’s head of equity
Prudential Investment Managers, one of the top three shareholders in PPC, says it opposes a proposed merger between SA’s largest cement group and its unlisted South African rival AfriSam. Prudential, which holds 13%-14% of PPC, said it wanted "other shareholders to think twice" about such a transaction. It said AfriSam’s recent revised offer, which had the backing of Canada’s Fairfax Africa Investments, undervalued the group. It believed PPC’s share price would double in the next three to four years with the ramp-up of its rest of Africa operations including in Ethiopia, Rwanda and the Democratic Republic of Congo. "The shareholders have been asked to back a short-term gain," Chris Wood, Prudential’s head of equity, said on Monday. "From this point forward, there will be a material improvement in [PPC’s] cash flow." Fairfax was using PPC’s earnings before interest, tax, depreciation and amortisation in the year to March 2017 as a basis of reported profits. This was not a fair repres...
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