Afrisam deal with PPC hits roadblock
New plan to revive merger on the cards to create cement group with more capital
The merger between Afrisam and PPC has fallen through for now but plans are already under way to resuscitate the deal, with Afrisam expected to submit a new proposal to PPC by Friday. The new plan aims to create a group with greater scalability and access to capital than the rescinded proposal was able to deliver. PPC announced on Friday that Afrisam had withdrawn its heads of terms, which had predefined the outcome of the merger and precommitted Afrisam and PPC to a basis for valuation among other terms. The group's share price fell by more than 7% on Friday, closing at R4.87. PPC's share price had declined over the past six months, though it has recovered in recent weeks. PPC chairman Peter Nelson said the heads of terms had not been settled to all parties' satisfaction. "If you do a valuation based on the heads of terms and then do a reality check, comparing where the share price is, you start to get gaps that are difficult to explain and justify," Nelson said. Scale and capital ...
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