Bumping heads for PPC
The cement maker is flavour of the month — and at least one investor says it’s worth far more than the current offer
So whose side is the Public Investment Corp (PIC) really on in the battle of the cement giants — SA’s largest cement producer PPC, or its smaller rival AfriSam? This week the PIC raised its stake in PPC, which is being courted by numerous suitors, to 21%. It’s an extraordinarily large punt on the ailing cement sector, considering the PIC already owns two-thirds of debt-laden AfriSam. The PIC was sparked into action by Canadian insurance group Fairfax, which emerged from nowhere a few weeks ago with an offer to buy R2bn of shares in PPC (at R5.75/share) — but on condition that PPC merged with AfriSam.Only, since its plan first came to light on September 4, PPC’s shares have soared 26% to R6.90 — far beyond the offer price. This was spurred, in part, by the prospect of a bidding war, as African giant Dangote emerged with its own offer, as did Irish group CRH. Either way, it seems Fairfax’s offer is dead in the water — which should please the PIC, if it was hiking its stake in PPC as a...
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