Thursday, June 13, 2024

Botash up for shareholders delusion

A horde of unnamed suitors are eyeing to take a stake in Botswana Ash ÔÇô trading under Botash ÔÇö the biggest producer of soda ash and salt in the sub-region.

Rod MacLeod, the leading transaction advisor to the existing shareholders and a director at Imara Capital, confirmed from his office in Johannesburg on Friday that “ various parties are interested” but declined to name them.

“There are various parties interested in this transaction because Makgadikgadi Pan, which is the flagship of the product, has the capacity of being the largest soda ash producer in the region,” he said, adding that “it is pre-mature to disclose the names of bidders at this stage.”

“The successful track record of Botash has attracted the attention of various companies in the chemical industry. A number of these companies have made approaches to the shareholders of Botash with a view of acquiring the shares in Botash,” a statement from the mine said last week.
Botash is 50 percent owned by Botswana government, while Anglo South Africa Capital Ltd and De Beers Botswana and AECI are holding 14 percent each and the rest are held by FirstRand Bank, Standard Bank and Nedbank.

The appetite on Botash is said to be driven by world commodity prices which are largely powered by Asian countries, namely China and India. The two countries are currently enjoying phenomenal growth rates.

“In recent months, interest in Botash has intensified, and the current shareholders of Botash are now formally considering some of these approaches. The shareholders of Botash may choose to engage in further discussions with the interested parties, provided that the shareholders receive assurances from such parties that any transaction will take into account the interests of all Botash shareholders, including Botash employees and customers and any new shareholders in Botash will remain committed to its long term future,” the statement added.

However, MacLeod said at the moment shareholders are keeping a clear head on future shareholders’ structure.

If the move is successful it will be the second biggest mining transaction this year following the acquisition of Gallary Gold by IAMGold early this year. It will also represent the second such transaction involving the same mine- and the third such transaction in the recent history following the acquisition of Anglo American shares in BCL by LionOre at the beginning of the century.

Botswana Ash has proved itself as a significant player in region and is currently exporting to Angola, South Africa, Zambia and Zimbabwe.


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