PSV scraps empowerment deal
INCECONNECT / 09 JULY 2019 - 14.33 / STEPHEN GUNNION
The industrial group hasn't received the subscription price from its prospective empowerment partner.
PSV Holdings and terminated an empowerment deal with Beryl Holdings after it didn't pay its R5 million subscription price ahead of taking a stake in the company.
The deal, announced last September, was aimed at meeting requirements for black economic empowerment and was expected to open up more growth opportunities for the group. Mauritian-based investor Regis Holdings also bought a 35% stake in PSV for about R25 million on the back of the deal with Beryl, which is a subsidiary of diversified investment company Beryl Group. A condition of the Regis investment, which was used to recapitalise the company, was the simultaneous conclusion of a broad-based black economic empowerment transaction.
PSV said in order to meet its empowerment objectives, it had resolved to sell a stake in its PSV Industrial business to a broad-based ownership scheme to set up an education trust. It said the sale would be structured to address the black ownership requirements of its operating divisions.
PSV is an industrial holding company listed on the JSE's AltX market. It is focused on the provision of steel, stainless steel, industrial supplies and specialised control valves, among other things. Its customers are in the mining, water, wastewater management, healthcare, infrastructure and manufacturing sectors.
Last week, it reported a larger loss for the year to end-February but said new management was making encouraging strides towards delivering a turnaround.
Its shares closed unchanged at 24c yesterday. It made the announcement after the close of trade.
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