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Voluntary announcement regarding the acquisition of the trading assets and liabilities of Plasti-Weld CC
HUDACO INDUSTRIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1985/004617/06)
Share code: HDC & ISIN: ZAE000003273
("Hudaco")
VOLUNTARY ANNOUNCEMENT REGARDING THE ACQUISITION OF THE TRADING ASSETS AND
LIABILITIES OF PLASTI-WELD CC ("PLASTI-WELD")
1. INTRODUCTION
Shareholders are advised that Hudaco has signed an agreement with Plasti-Weld to acquire
its trading assets and liabilities (the "Plasti-Weld Business") (the "Transaction") with effect
from 1 December 2023 (the "Effective Date").
The purchase consideration (the "Consideration") will be based on the annual profit after tax
of the Plasti-Weld Business for the three preceding financial years and the first year after the
Effective Date. The maximum Consideration is R56 million, which will be funded from cash
generation and existing facilities of Hudaco.
2. DESCRIPTION OF THE PLASTI-WELD BUSINESS
The Plasti-Weld Business is an importer and stockist of plastic welding equipment, hot-air
tools, specialised test and inspection equipment and thermo cutters. It also manufactures
plastic welding rod and employs 15 staff, all based in Gauteng.
3. RATIONALE FOR THE TRANSACTION
Hudaco specialises in the importation and distribution of selected high-quality branded
automotive, industrial and electronic consumable products, mainly in the southern African
region. One of Hudaco's key strategies is to acquire new businesses in similar fields of activity
when the opportunity arises.
The purchase of the Plasti-Weld Business is consistent with Hudaco's acquisition strategy and
is an ideal fit for the engineering consumables segment of Hudaco, as a bolt-on to its existing
thermoplastic pipes and fittings business, Astore Keymak, which also sells plastic welding
equipment. They will work together in exploiting synergies, optimising their route to market
and expanding the combined customer base. Hudaco will be able to utilise its experience and
expertise in value-added distribution to enhance the position of the Plasti-Weld Business,
resulting in long term benefits to shareholders.
4. CATEGORISATION
The Transaction falls below the threshold of a category 2 transaction in terms of the JSE
Limited Listing Requirements. Nevertheless, Hudaco's board of directors believes it is
appropriate to voluntarily inform shareholders of the Transaction.
Johannesburg
30 November 2023
Corporate advisor and sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Date: 30-11-2023 09:12:00
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