Imperial has announced the sale of its South American shipping business to Hidrovias do Brasil S.A., an independent integrated logistics provider focused on waterways logistics services in Latin America. The closing date of the transaction was 16 April 2021.
Hidrovias do Brasil has bought the 90-vessel operation, which reportedly saw revenues of $36m for the year ending 30 June and EBITDA of $9.4m. The deal for $90m, included an earn-out of up to $5m based on water levels over four years.
Hidrovias do Brasil acquired imperial logistics operations in South America, headquartered in Asunción (Paraguay) and operating in the Paraguay-Paraná Waterway. With this move, they added 7 more pushers and 84 barges to their fleet almost doubling their transport capacity and starting operations in new regions. In addition, they will welcome 150 additional employees.
As previously communicated to the market, it is Imperial’s strategic intent to become a “‘One Imperial’ business and serve as the ‘Gateway to Africa’ to our clients, principals, and customers. We are transforming from a portfolio of regional businesses to an integrated end-to-end logistics and market access business that is focused on Africa, leveraging our scale, competitive advantages and capabilities in the healthcare, consumer, chemicals, automotive, and industrial and commodities industries.
As such, we thoroughly assessed the strategic fit of our Logistics International business and decided to exit this business in a phased approach as it is non-core. The South American shipping business forms part of this process and follows the disposal of the European shipping business, which was concluded on 31 July 2020. The remaining freight management and contract logistics operations within the International Logistics business remain for sale and we are in the process of disposing of these, as announced at the group’s F2021 interim results on 23 February 2021.”
“Hidrovias do Brasil S.A. is well positioned to operate the business sustainably based on long-standing customer relationships and a highly skilled, experienced and motivated work force,” says Mohammed Akoojee, Imperial’s Group Chief Executive Officer. “We believe that this is the most suitable home for the South American shipping business and its people.”
“This acquisition gives us a very important operational flexibility which will allow us to complement our navigation capacity and operate in regions where we currently do not access” says Fabio Schettino, Hidrovias do Brasil S.A. CEO.
The transaction’s proceeds will be used to optimise the financial position of Imperial, reducing its overall existing debt in the short-term and will be invested in new growth areas in line with the Group’s strategy in due course.
