Imperial Logistics is expected to benefit from growth in Africa, after the company recently sold some of its European and South American assets to refocus its investments on the continent.
Imperial Logistics plans to acquire transport company J&J Africa before its own takeover by DP World.
The South Africa-based company is in talks to buy the business from its private equity owners, it said in a statement Tuesday confirming an earlier Bloomberg News report. There is no certainty that a deal will be made, Imperial said.
A deal, if struck, could value J&J between $ 350 million and $ 400 million, according to people familiar with the matter, who asked not to be identified while discussing confidential information.
J&J provides transport and logistics services in five African countries, including Zambia and Zimbabwe. It was bought by Carlyle Group and Investec Asset Management – now renamed Ninety One Plc – in 2014. J&J was valued at $ 200 million at the time, people said.
As of last year, Carlyle’s stake has been managed by Alterra Capital Partners, a spin-off from the buyout giant, and Ninety One’s holding by Ethos Private Equity.
Representatives for Alterra, Carlyle and Ethos declined to comment, while a spokesperson for Ninety One referred the calls to Ethos. A representative for J&J did not immediately respond to requests for comment.
A purchase of Mozambique-based J&J would be one of Imperial’s largest to date, according to data compiled by Bloomberg, and would strengthen its presence on the continent as it prepares to become a new owner. Dubai-based port operator DP World this month mentionned he would buy Imperial in what will be his largest acquisition in Africa.
DP World said the deal demonstrates long-term confidence in the South African economy despite recent challenges. The country has seen violent riots this month after the arrest of its former president Jacob Zuma. Talks between Imperial and J&J were underway before DP World’s announcement, people said.
Imperial said in its statement that a purchase from J&J would require approval from DP World. A representative for DP World declined to comment.
Imperial started out as a small car dealership in the 1940s in Johannesburg and now employs over 25,000 people worldwide. Under the leadership of Managing Director Mohammed Akoojee, it seeks to position itself as the gateway to Africa for the transport of goods.