Pretoria - Raubex intended to acquire two road construction businesses for a total of R100 million, the listed road construction and rehabilitation company said yesterday.
Thaba Bosiu Construction and Zamori Construction both specialise in road construction and have a well established presence across the country.
The construction division of Raubex, which listed on the JSE in March last year, has about a dozen projects under management with a total contract value of more than R900 million.
The vast majority of the contracts are from government-related bodies, including local municipalities and the SA National Roads Agency.
Francois Diedrechsen, Raubex's commercial and financial director, said the acquisitions were another capacity-building move for Raubex to reinforce its road and civil infrastructure capabilities.
The operations of Thaba Bosiu and Zamori would be integrated into Raubex's construction division.
"One of the most value-enhancing parts of this deal is that top management will remain on board," Diedrechsen said. "We have been looking to further reinforce our heavy construction presence in South Africa Both companies have a great reputation in this area."
Raubex Construction operates in all nine provinces and throughout the Southern African Development Community, but it has been looking to increase its presence nationally.
Willie van der Merwe, a director of Thaba Bosiu and Zamori, said the companies regarded the acquisitions as mutually beneficial. He expressed confidence that the firms' combined resources and expertise would ensure greater access to projects.
Thaba Bosiu's profit after tax for the six months to August was R6.35 million.
Zamori achieved after-tax profit of R10.87 million for the year to June.
The acquisitions are subject to a number of conditions. The companies expect these to be fulfilled by the end of April.
Raubex shares lost 3.05 percent to R35 yesterday. The construction and materials sector fell 5.03 percent.