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SA: Intertrading plans asset offload

JSE-listed fruit and vegetable exporting specialist Intertrading has proposed selling off operational assets that generate about R180m in annual turnover for just R8.8m.

The entity that will buy Intertrading's operating assets is Linkit Investments, which includes two Intertrading directors - former CEO Frik van Rooyen and executive director Bernd Julicher - as shareholders.

At face value the purchase price looks a steal, considering that Intertrading in its last financial year to end-February 2009 managed gross profits of R24m and pre-tax profits of R2.2m.

The bulk of Intertrading comprises Agrilink (which procures and market fresh produce) and Skyservices (which offers airfreight, forwarding and logistical services).

The purchasers appear to be banking on shareholders accepting the deal without too much fuss, noting that the shell company could be used for a reverse listing transaction.

Shareholder enthusiasm for a buyout may be helped by the fact that Intertrading endured a tough interim trading period. The company recorded a R1.7m loss from turnover of R62m for the half-year to end August 2009 - a period which traditionally is recognised as a the slower trading half.

It was these interims that provided a strong hint of what was to come, when chairperson Nino Burelli pointed out that Intertrading's underlying businesses could not sustain the current costs of remaining a listed entity.

Indeed, Intertrading has not set the investment world alight and since its listing in the late 1990s, there has only been scant market interest.

The main shareholders are Univeg Trade France and Conafex Africa Holdings - two specialist agribusineses. So far there has been no indication whether these two shareholders have agreed to support the proposed transaction.

Source: www.fin24.com

Publication date: 12/9/2009


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