MATHUPHA CAPITAL INVESTMENT (PTY) LTD ( MCI ) November 2017

Transcription

1 MATHUPHA CAPITAL INVESTMENT (PTY) LTD ( MCI ) November 2017

2 CONTENTS Who we are Shareholding structure Management team Investment philosophy Current and previous investments Investment rationale INCA Strategy

3 WHO WE ARE MCI is a diversified industrial investment company that invest its own capital & 3 rd party funding in different industrial manufacturing companies that are involved in; Manufacturing of products supplied to the Infrastructure and Construction Sector Manufacturing of products supplied to the Mining sector Manufacturing of products supplied to the State owned Companies (SOE s) MCI s investments strategy is to grow through acquisition of majority stake (51% plus) in companies that are within the target market where synergies can be maximised with existing investment profile. Target companies must be profitable with significant return on investment in medium to long term MCI aims to list its investments on the JSE within the next 3 to 5 years to further grow its business, access more capital and create an exit mechanism for early investors.

4 MCI SHAREHOLDERS MCI is to be partly owned and managed by its management staff and the founding Black Industrialist. Aljen Family Trust 10% The management has significant experience in investing in companies in the mining, manufacturing and the service industries. Rail 2 Rail 100% Mathupha Capital Zimkhitha Zatu 10% Mathupha Family Trust 80%

5 Monde Africa (CEO) MANAGEMENT TEAM Zimkhitha Zatu (COO) Professional qualifications MBA Previous professional experience Executive Chairman MIG Chairman - GEP credit committee Marketing Director- Virgin Mobile Head of Sponsorship - SABMiller Head of Marketing- Heineken Directorships Rail2Rail (Pty) Ltd Gibela Rail (Pty) Ltd MIG (Pty) Ltd Mathupha Capital Powerhouse Africa Shanike Property Development Umnotho Wesizwe Professional qualifications Chartered Accountant Previous professional experience Supervisor - KPMG Account Manager IDC General Manager PPC Ltd Directorships Rail 2 Rail (Pty) Ltd Commuter Transport Engineering African Women Chartered Accountants (NGO) Siyazisiza Trust (NGO) National Film and Video Foundation

6 INVESTMENT PHILOSOPHY AND APPROACH MCI will invest its capital within the target market for a return of no less than 12% RATTIR The target company should be among the top 10 in its sector with a positive EBITDA and potential for growth. Minimum Target EBITDA is R5m per annum Our funding will be used to acquire majority stake in the target company We will have the right to replace top management of the company in particular the CEO and CFO We will proactively participate in management and the boards of the companies we invest in and give strategic direction. We will Invest in companies that are nationally and globally competitive Supporting expansions of existing businesses will be considered for an equity stake Only in exceptional cases were we will invest opportunistically in turnaround businesses that have a potential to succeed. MCI aims to list in the Johannesburg stock exchange within the next 3 to 5 years Trigger for listing will be a R1b Turnover of the group with no less that 4 company investments

7 MCI PREVIOUS, CURRENT AND POTENTIAL INVESTMENTS Concrete products (Rail to Rail) - Manufacturer of railway sleepers established in Long term supply contract with Transnet (over 1 mil sleepers supplied to date) - Licence agreement with Rail One GmbH, one of the largest sleeper producers in Germany and Europe. Existing Mining (Umnotho Wesizwe) Mining sector supply - Roof bolts - Cement/Wood roof support - Construction materials Infrastructure products - Clay and cement brick manufacturing - Concrete pipes - Concrete paving Pipeline

8 RAIL 2 RAIL INVESTMENT Rail 2 Rail (Proprietary) Limited ( R2R )is a company based in Kimberley, South Africa, that specializes in the manufacture of reinforced concrete railway sleepers primarily at present for Transnet Freight Rail (TFR) R2R s manufacturing process uses advanced German technology under license from Rail One GMBH. The business has developed rapidly from initial production in 2010 and currently has a strong market position The business has produced over 1 mil sleepers to date for TFR R2R is a well established, cash generative and sustainable business that has successfully managed its rapid growth over the past three years R2R is well known and respected in the industry for the high quality of its products.

9 INVESTMENT RATIONALE FOR INVESTMENT IN INCA Synergy with existing and potential investments. The investment in INCA provides MCI an opportunity to pull resources and add value to other ongoing investments in the cement concrete products sector Increase in geographical and infrastructure footprint INCA has presence in Eastern Cape where there is significant infrastructure potential. This potential can be enhanced with the partnership of a partner with industry experience in construction and infrastructure. Diversification of our customer base INCA provides an opportunity for MCI to diversify in product offering and customer concentration risk

10 OUR SHORT TO MEDIUM TERM STRATEGY Revenue improvement Introducing revenue from retailers eg Massmart Introducing supplementary products eg roof tiles Formation of strategic supply partnerships with public and private sector through innovative product offering and deal structuring Cost efficiency Partnering with La Farge on technical support to improve concrete mix and on innovation Acquisition of an aggregates quarry to improve gross margins Bulk supply rebates & discounts agreements with major suppliers for the group based on existing R2R supply networks eg LaFarge and PPC Operation optimisation Increasing management depth by introducing R2R skills transfer Introducting learnerships for long term succession planning Cost containment strategy in the plant eg limiting waste, water and energy efficiency