The board of Johannesburg-headquartered Imperial has announced that it has entered into an agreement for the sale of its South American shipping business to Hidrovias do Brasil SA.
The agreed maximum enterprise value for the interest in the South American Operations is US$90M, which equates to a multiple of 9.6 x FY 2020 reported EBITDA. The enterprise value includes an earn-out component of up to US$5M, which is payable dependent on water levels over the four-year period commencing on 1 January 2021.
“As previously communicated to the market, it is Imperial’s strategic intent to become a ‘One Imperial’ business and serve as the ‘Gateway to Africa’ to our clients, principals, and customers,” stated Imperial.
“We are transforming from a portfolio of regional businesses to an integrated end-to-end logistics and market access business that is focused on Africa, leveraging our scale, competitive advantages and capabilities in the healthcare, consumer, chemicals, automotive, and industrial and commodities industries.
Mohammed Akoojee, Imperial’s group CEO, said. “Hidrovias do Brasil SA is well positioned to operate the business sustainably based on long-standing customer relationships and a highly skilled, experienced and motivated work force. We believe that this is the most suitable home for the South American shipping business and its people.”
Fabio Schettino, CEO of Hidrovias do Brasil SA, commented: “This acquisition gives us a very important operational flexibility which will allow us to complement our navigation capacity and operate in regions where we currently do not access.”
Hidrovias is an independent integrated logistics provider focused on waterways logistics services in Latin America.
In its ‘Northern Corridor’ (Miritituba-Barcarena, Pará), Hidrovias offers an integrated logistics solution to transport grains from the Midwest region of Brazil to an export port. In its ‘South Corridor’, operations use the Paraguay-Paraná rivers system, where it transports over 6 Mtpa of cargo, such as, iron ore, grains, fertilisers, pulp and others.
In the second quarter of 2020, Hidrovias began operations in Santos, the largest port in Brazil located in the state of Sao Paulo, with transhipment and storage of salt and fertilisers.
The closing date of the transaction was 16 April 2021.