TUESDAY, 10.30AM:
THE US-based multinational Dow Chemical Company has offered to buy troubled local chemical giant Sentrachem for R2-billion in a deal which see the US company relaunching its local investments after disinvesting in 1987.
Sankorp, Sentrachem’s largest shareholder, has accepted an offer of R10,50 a share for its 38,74% stake and, according to Sentrachem chairman Attie du Plessis, “will make positive recommendations” to minorities. “We believe it is a good deal for shareholders, including minority shareholders. It is a good fit with strong synergies.”
The offer represents a 33% premium on the share price. Sentrachem shares were suspended on the JSE after Monday’s announcement. The share price closed at R7,92 on Friday after trading around R14 a year ago, before the posting of a R217-million loss in the six months to February 1997. The deal is expected to put a halt on Sentrachem’s restructuring programme.
Neither company would comment on whether the deal might lead to a management shake-up, but it is believed Dow will bring in its own management to boost confidence in Sentrachem, which has been undervalued by local markets recently.