PSG aligned investment company Zeder appears to have positioned The Logistics Group (TLG) – the old terminals arm of the fruit marketing giant Capespan – into a valuable logistical and terminal hub that is poised for sprightly growth.
TLG was split off from Capespan over five years ago, and now comprises terminal services and warehousing facilities, an integrated suite of logistical solutions, stevedoring facilities, clearing and forwarding as well as digital technology solutions.
For its six month period to end June, TLG reported recurring headline earnings of R90 million – up a whopping 186% from the prior comparative period. Zeder CEO Johan le Roux said the profit increase was as a result of the positive effect of the strong commodity cycle and the resultant higher volumes on the export mining commodity side of the business.
He added that the citrus industry experienced record volumes and this contributed in terms of growth in the higher margin fresh fruit export segment.
At this juncture, the rumour mill suggests Zeder – which is mainly focussed on agricultural businesses – might be looking to sell its 98% stake in TLG.
Existing operators like Grindrod and foreign entities looking for a foothold in Africa might be potential suitors.
The price that Zeder extracts for the business will be intriguing. At the end of August this year, Zeder increased its valuation of TLG by around R105 million to R1.4 billion.
This continues a steady increase in Zeder’s valuation from R1 billion at the end of August 2020 and R1.3 billion at the end of February this year.
Surprisingly Zeder’s valuation of TLG is higher than its similar sized stake former parent company Capespan, which is estimated at R1.1 billion. That gives some indication how quickly TLG has been growing in recent years.
