Durban - Grindrod, the shipping and logistics group, is still hot on the acquisition trail after it recently concluded its seventh deal with the acquisition of a 50 percent stake in Oreport for R40 million, an international marketing organisation.
Tim McClure, the managing director of Island View Shipping, a Grindrod subsidiary, said yesterday there were other deals in the offing that were being done within a strategy of boosting the group's landside logistics business and that had synergies with its shipping business.
In response to concerns that the rapid pace of acquisitions was exposing Grindrod to risk, he said all deals were subject to a full due diligence and were closely monitored once the businesses were acquired.
Oreport specialises in the worldwide procurement, physical movement and distribution of a range of industrial raw materials such as minerals, ores and alloys.
The deal, which was concluded with Oreport's shareholder Seascape Commodities, is expected to further advance Grindrod's strategy to diversify and to assist Oreport in achieving its growth targets.
In terms of the deal, which is subject to regulatory approvals including that of the competition commission, Oreport will continue to be run by its existing management.
Grindrod is building its land-based businesses to counter any downside in the shipping business.
In the year to December, Grindrod reported a 130 percent increase in attributable profit to R550 million.
Grindrod is due to release interim results in August.
Island View Shipping, which was largely responsible for the group's strong performance, has benefited from demand from China for raw materials.
Grindrod is planning to double the group's size in the next three years through acquisitions.
Part of this strategy is to buy into businesses that are driven by successful entrepreneurs. So far Grindrod has spent more than R400 million of the R1 billion earmarked for land-based acquisitions.
The group's acquisitions include Richards Bay warehousing business Sea Munye Port Holdings; a 72 percent stake in African Portland Industrial, which has given it control of the Maputo and Walvis Bay coal terminals; and wholesale furniture removal business Boltt Removals.
It has also bought half of Sheltam Locomotive and Rail Service; Uniroute's container depot and warehouse facilities; and the shipping and commodity trading operations of Seaboard Corporation.
Yesterday Grindrod's share price closed at R44.50, up 0.56 percent, while the transport index shed 1.29 percent.