Media

Absa buys Tsebo stake

The Times - I-Net Bridge

28 January 2008

Tsebo Outsourcing Group (Tsebo), one of the largest black empowered hospitality and facilities management companies, including Fedics and Drake and Scull, in Southern Africa with annual turnover in excess of two billion rand. This follows the exit by Ethos Private Equity after eight years. The remaining 50.1% shareholding will see Tsebo’s management increase their stake to 20%, with existing empowerment partner Nozala Investments and new empowerment partner Lereko Investments acquiring 30% shareholding, split equally. The remaining 0.1% will be held in a trust for future allocation.  André Pieterse, Head of Equity Investments at Absa Capital, says they are very pleased to invest in a winning company with a winning culture.

"Tsebo has shown strong growth and cash generation in recent years and we believe that this will continue." Through substantial growth in turnover under existing management, Tsebo has created value for both empowerment and equity partners. This transaction will allow Tsebo the opportunity to continue realising their strategic initiatives.  Tsebo CEO Clive Smith believes their track record is proof that empowerment linked with private equity works. "Our partnership with Ethos Private Equity and Nozala Investments afforded us the space and flexibility to concentrate on developing new contracts and markets through our vast network of contacts and relationships. New empowerment partner Lereko Investments’ industry knowledge and expertise will enable us to continue with our growth strategy."  Empowerment partner Nozala Investments believe they have added value from both an operational and strategic point of view, truly creating an environment where empowerment deals are delivered on the basis of the real commercial value realised.  Tsebo has a market leading position in the hospitality and facilities management service industry and employs in excess of 10,500 people.

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