Ethos Grabs Tiauto Shares For R1.5bn
Shareholders in Tiger Automotive (TiAuto) yesterday voted in favour of the sale of all the shares in the listed retail and wholesale after-market wheel and tyre company to Ethos Private Equity for about R1.5 billion, and for the delisting of the firm.
The offer to TiAuto shareholders, via a scheme of arrangement, is subject to some conditions, including approval by the competition authority. If successfully concluded, TiAuto will become a wholly-owned subsidiary of Ethos. TiAuto is the holding company of Tiger Wheels' (Tiwheel) hived-off wheel and tyre retail and wholesale operations in South Africa and the UK, which was listed separately on the JSE's speciality retailers sector in 2006.
Ethos gave notice last month it intended to make a firm offer to acquire all the shares in TiAuto.
Shareholders representing about 64.8 percent of the shares eligible to vote at the scheme had provided irrevocable undertakings to vote in favour of the scheme. They included listed Bidvest subsidiary BB Investment Company, which owns 20.2 percent of TiAuto's share capital.
Other major shareholders, who support the scheme, are Coronation Fund Managers (12.6 percent), RMB Asset Management (11.1 percent), Tiwheel chairman Eddie Keizan (10.8 percent) and TiAuto managing director Keith Rivers (1.2 percent). The offer price of R17.51 a share represents a 33 percent premium to the 30-day volume-weighted average precautionary price of R13.15 on October 17 last year. Rivers said Ethos had approached the company in August and the management was impressed with Ethos's growth philosophy, which would enable TiAuto to focus on building the business.
Ethos has participated in many landmark transactions locally. Among these was its ownership for eight years of Dunlop Africa before exiting the business in 2006, when it sold it to an Indian firm.
Rivers said TiAuto was impressed by the speed at which Ethos was able to process the transaction and hoped their previous experience in this market would support TiAuto's strategic planning into the future.