AIIM, Mokobela-Shataki consortium buy The Logistics Group for US$110mn

05 Apr 2022

The acquisition positions AIIM and Mokobela-Shataki as strategic players in the southern African logistics space, servicing capacity shortfalls, improving port-to-inland transport corridor efficiency and increasing economic activity.  

Cape Town, 5 April 2022 – African Infrastructure Investment Managers (AIIM), one of Africa’s largest infrastructure-focused private equity fund managers, and the Mokobela-Shataki consortium have completed a ZAR1.6 billion takeover of The Logistics Group (“TLG”) on 31 March 2022. The integrated logistics company operates in Southern Africa with services across port, rail, warehousing and digital transport logistics.

The transaction was financed by a mix of equity and debt financing. AIIM, through its flagship South African IDEAS Fund and AIIF4 Fund, acquired a 74% stake in TLG. The remaining 26% stake was acquired by strategic investment partners, the Mokobela-Shataki Consortium, sponsored by Moss Ngoasheng, founder and CEO of Safika Holdings (Pty) Ltd, and Monhla Hlahla, former CEO of the Airports Company South Africa and current Chairperson of Royal Bafokeng Holdings.

Adding TLG to the AIIM portfolio bolsters its transport strategy in southern Africa, helping to address capacity deficits from ports and inland transport. South Africa’s ports are some of the continent’s least efficient. Doubling efficiency could equate to halving the distance between the country’s main trading partners. 

Investment in transport corridors running from strategic southern African ports will benefit from strong growth prospects for various bulk and break-bulk cargoes, such as battery metals, cementing the continent’s role as a key player in the global energy transition.

Commenting on the transaction, Ed Stumpf, Investment Director at AIIM, said: “TLG presents a rare opportunity to acquire a multi-corridor player while addressing regional capacity constraints in partnership with Transnet and other major operators in the region.  We view TLG as the cornerstone for a regional ports and logistics platform which will pursue additional investments along a number of transport corridors.  

“Looking more broadly, this will help reduce transport costs, which can have a considerable impact on the price of goods and catalyse trade regionally and beyond.  Positioning the group to support multi-mode rail/road and backhaul cargo efficiency is a core part of our strategy to reduce carbon emissions as part of the journey to net zero.”

Olusola Lawson, Managing Director & Co-Head at AIIM said: “This represents our next generation pan-African fund AIIF4’s first investment. AIIF4 is a thematic investor with a high-quality diversified pipeline across the Digital infrastructure, Energy Transition and Mobility and Logistics sectors. We look forward to expanding the fund’s portfolio.”

Investment to enhance the existing TLG terminals in Cape Town, Port Elizabeth and Durban will be pursued in partnership with Transnet National Ports Authority, while operational ramp-up of TLG’s businesses in Mozambique, Zambia and Namibia will be prioritised.

AIIM will also seek to develop bolt-on investment prospects in other key markets where it has portfolio investments and on-the-ground experience to ensure TLG provides a comprehensive offering along diverse corridors to hinterland centres of production or demand, commencing in the Southern and East African region.

In line with the company’s integrated ESG approach, AIIM will monitor implementation of an Environmental and Social Action Plan, including strengthening the health and safety conditions, reviewing HR policies and systems and evaluating site-specific climate related risks.

“We are excited to conclude this transaction and create a long-lasting partnership with AIIM and TLG. The acquisition allows Mokobela-Shataki to gain a strong foothold in the Southern African logistics industry, which we envision to be a key catalyst for the economic recovery and future growth of the region post Covid-19. 

“The combination of TLG’s logistics expertise and the infrastructure investments and ports expertise of the AIIM Mokobela-Shataki Consortium will create greater supply chain efficiencies, deliver more comprehensive logistics solutions into a wider market and ensure a sustainable and positive impact on communities and the planet,” says Moss Ngoasheng

AIIM’s legal advisor was ENS. Singular Consulting provided commercial advice and KPMG led on accounting and tax.

 

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