SOUTH AFRICA: Swedish refrigeration wholesaling group Beijer Ref AB is set to acquire the Johannesburg-based wholesaler Tecsa (Pty) Ltd.
Controlled by Westbrooke Investments, Tecsa (Pty) Ltd trades as TecsaReco with a wide range of products and brands within commercial and domestic refrigeration, air conditioning and spare parts for domestic appliances.
Purchase price will be between SEK255m and SEK300m (€26.6m to €31.3m) depending on TecsaReco’s performance in the current financial year ending 28 February 2018.
Tecsa was originally founded in 1965 as a wholesaler of parts and accessories for household appliances. In 2013, Tecsa acquired Reco, a refrigeration and air conditioning wholesaler that started its operations in 1947.
From its headquarters in Johannesburg, its products are distributed through a number of branches, of which one is located in Namibia and one in Botswana. In total, TecsaReco has more than 300 employees and gross sales in 2016 amounted to approximately SEK435m (€45.4m).
Beijer Ref says Tecsa will continue to be operated as a standalone business in its current form. It will supplement Beijer Ref’s existing subsidiary wholesalers in South Africa, Eurocool and Metraclark.
“The acquisition is positive for several reasons,” said Beijer Ref CEO Per Bertland. “Our product range is strengthened with complementary segments and brands. We also access new and well-established sales channels. Above all, Beijer Ref acquires a stronger footprint in a growing market with a population that is gradually increasing its income and purchasing ability. The opportunities to reach out with our own manufactured and more environmentally friendly products also increase significantly.”
The parties have reached a binding agreement as of today and the takeover is scheduled for 1 March 2018. The acquisition is expected to generate positive effects on both sales and results in the long term. The purchase is subject to approval by the competition authorities in South Africa, Namibia and Botswana.