TSL Limited is nearing completion of a US$25 million acquisition of a controlling stake in Nampak Zimbabwe, with only shareholder and regulatory approvals still outstanding before the landmark deal is sealed.
The transaction will see TSL acquire 51,43% of Nampak Zimbabwe from its South African parent, Nampak Limited, as part of a broader strategy to build an integrated, end-to-end packaging and distribution business.
In an exclusive interview with businessdigest, TSL chief executive officer Derek Odoteye said the company was financially ready to execute the deal, with part of its US$4,5 million capital expenditure for the year already committed to the transaction.
“From a financing perspective, we are in a secure position. The main issue that remains is getting shareholder approvals. Regulatory approvals are also in the pipeline,” Odoteye said.
“Once these two components are in place, we expect to close the transaction towards the latter part of this year. From our end, the financial resources are ready, and the intent is strong.”
A binding sale and purchase agreement has already been signed between the parties, he said, marking a significant milestone in finalising the transaction.
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“We have a sale and purchase agreement in place that is the principal binding document. It sets out the key terms of the deal and acts as the foundation upon which the transaction is being processed,” he added.
“This agreement is now the basis for what will be presented for shareholder approval. It is a crucial milestone that gives confidence in the seriousness and structure of the acquisition.”
Regulatory approvals are being sought from the Competition and Tariff Commission and other authorities. TSL is also required to secure shareholder approval in line with statutory and listing requirements.
“Then, of course, there is the need for shareholder approval on both sides, which is standard in such acquisitions. Once we tick off those boxes, we can proceed with full integration planning,” Odoteye told businessdigest.
TSL is funding the transaction using a mix of internal reserves and structured finance.
“The funding side is secure, and the transaction is being funded through a combination of our own internal resources and some budget finance,” he said.
“We have earmarked about US$4,5 million in capex for the year. However, we have also reallocated some of what would have been capex towards the Nampak acquisition, which is a strategic investment.”
The acquisition adds a second packaging business to TSL’s portfolio, alongside its existing unit, ProPack.
“We currently have ProPack in that space, and Nampak would be the second packaging business,” Odoteye said.
He noted that the acquisition would strengthen TSL’s vertical integration model, creating a seamless value chain from agricultural production to the final consumer.
“We believe what Nampak currently does, which is packaging from field to marketplace, and also from processing to consumer, is an area that we would like to focus on and expand.”
The deal is expected to deliver immediate commercial benefits. Nampak Zimbabwe recorded a turnover of about US$100 million in its last financial year, which could significantly scale up TSL’s operations. By comparison, TSL posted US$36,89 million in revenue for the full year ended October 31, 2024.
“Their infrastructure, client relationships, and systems will enhance our packaging footprint, so this is not just about adding size but about creating a more competitive offering in the market,” he said.
Nampak Limited announced in October 2024 that it was exiting its 51,43% stake in Nampak Zimbabwe as part of a wider asset disposal programme aimed at reducing group debt and limiting exposure to Zimbabwe’s economic volatility.