New Zimbabwe.com

Pioneer’s Unifreight acquisition approved

LOGISTICS and passenger transport operator, Pioneer Corporation Africa announced Monday that it has received government approval for its Unifreight acquisition.
The development comes almost two-and-a-half years since the deal was first approved by the Zimbabwe Stock Exchange in August 2011. Some 51,49 million Pioneer shares will now be issued to Unifreight.
The effect of this transaction is significant as group revenues will double once it is incorporated into the accounts. According Monday’s notice, the group said the December 2013 audit was underway and the results would be issued in due course.
The group is also set to acquire Blue Star Logistics from Star Africa. Last week Star Africa said negotiations over the disposal of its subsidiary Blue Star Logistics have been concluded and the agreement of sale awaits signature.
Star Africa said proceeds of the disposal remaining after settlement of the vehicle finance loan and transaction costs would be deposited into a Trust Account to be used partly for settling with creditors.
Pioneer has, over the years, been posting marginal losses or trading at breakeven level. The group embarked on a restructuring attempt to improve profitability but the game changer, according to management, would be the merger with Unifreight.
Last year the company said its revenues could double once the Ministry of Youth Development, Indigenisation and Empowerment approved the transaction to incorporate Unifreight Swift operations into the group.
Under the proposed deal, Pioneer would pay US$7,2 million for the acquisition of fellow industry player Unifreight Swift, in a mega-deal that is expected to restore its leading position in the logistics business.
Unifreight would have about 36,7 percent in the enlarged ZSE-listed Pioneer Corporation Africa Group in a deal that would see group revenues doubling.
Prior to the transaction, Pioneer’s top three major shareholders were Drop Hill Investments with a 19,3 percent shareholding, High Wind Investment 16,6 percent and Earnbridge with 13 percent.Advertisement