Monday, October 26, 2020

Trailblazing Sefalana on verge of another deal

After a trailblazing entry into Namibia, Sefalana Holdings Limited is reportedly on the brink of completing two undisclosed transactions that will add to its burgeoning portfolio and cement it as a market leader.

The diversified group is looking to bolster its status in the market as it continues to scour for acquisitions.

The Botswana Stock Exchange (BSE) listed company released a cautionary statement last week indicating that talks are underway on a possible deal that will excite shareholders. Sefalana, which has been one of the large gainers on the local bourse, is negotiating two undisclosed transactions that may add to its portfolio.

“Further to the cautionary announcements issued in December 2014 and January 2015, shareholders of Sefalana are advised that the company continues negotiations with third parties which, if successfully concluded, and subject to relevant regulatory approval, may result in two transactions that, in turn, could have an impact on the price of its securities,” read a statement from the company, headed by Chandra Chauhan.

If the talks come out positive, they will show the company’s resolve as it plans to roll out its foot print in Africa. Sefalana recently entered the Namibian market and acquired the entire Metro chain in the country, consisting of 12 strategically located stores. The Namibia acquisition was expected to increase the group’s turnover by around P800 million in the first 10 months of trading and contribute approximately P30 million to profits. In the group’s results for the six months to 31 October 2014, revenues went up 32 percent from P1.2 billion on the prior year to P1.6 billion.

According to the company, Sefalana Cash and Carry Limited (Sefcash) contributed 70 percent and 45 percent of the group’s revenue and profit before tax for the reporting period respectively. The group is targeting 40 retail stores across Botswana. Apart from the fast moving consumer goods (FMCG) segment, Sefalana has extended its market presence through diversifying its business into investment in property, vehicle dealerships (MAN, TATA and Honda), sale of agricultural products, soaps and detergents, and operation of a travel agency. In Botswana, Sefalana operates Shoppers and Cash and Carry. Shoppers, which was launched in 2009, is widely regarded as Sefalana’s response to ChoppiesÔÇöthe local retail giant which has conquered Botswana and is now eyeing markets in the region for expansion. Sefalana Holdings Limited is a BSE listed blue chip company with market capitalisation of US$143.7 million or P1.4 billion. It has gained over 8.45 percent year to date (YTD).

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