JOHANNESBURG - PPC Chairman Peter Nelson said South Africa’s biggest cement
maker has received letters representing “likely more than” 25 percent of
shareholders indicating opposition to a proposed merger with local rival AfriSam
Group Pty Ltd.
The tie-up “requires 75 percent of shareholders to vote for it and obviously
more than 25 percent have a view that they are not going to support it,” Nelson
said by phone late Thursday. “We have received the letters, but we are in a
process that has to run its course.”
The simmering opposition casts doubt over a partial offer by Fairfax Financial Holdings
Ltd. of Canada that was made on condition the South African company merges with
AfriSam. Potential counter bidders should be granted enough time to conduct
full due diligence, PPC said earlier this week. Nigerian competitor Dangote
Cement , which has made an indicative proposal, will be granted a “reasonable
period” to decide whether to table a firm proposal, the company said.
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PPC’s
Biggest Shareholder Is Said to Back Fairfax-AfriSam Offer The Public Investment
Corp. is supporting the Fairfax offer, people familiar with the matter said
last month. Africa’s biggest money manager owns about 11 percent of PPC, according
to data compiled by Bloomberg. It’s also the biggest shareholder in AfriSam
with about 60 percent.
For its part, PPC has said the bid of 5.75 rand a share for 2 billion rand
($146 million) of stock undervalues the business and its prospects. The Fairfax
proposal also includes a recapitalization of AfriSam ahead of the merger. PPC
has hired
Investec Plc to review the offer. PPC shares fell 0.2 percent on Thursday to
6.45 rand, valuing the company at 10.3 billion rand.
The
shareholders’ views were a matter for AfriSam rather than PPC “to reflect on,”
Nelson said.