Home » Business » IDC to Dispose of Deven

THE Industrial Development Corporation through its subsidiary, Motec Holdings, is disposing of its coach building and commercial passenger transport company, Deven Engineering in a share or asset sale. IDC general manager, Mr Mike Ndudzo said the disposal of Deven Engineering was part of the restructuring of the Motec group, and involves moving the Deven operations to the Willowvale Mazda Motor Industries site and thus releasing the land and buildings for disposal so as to raise funds to recapitalise WMMI, without resorting to the shareholders, IDC or Government Treasury as the majority shareholder in the group.

“This follows dramatic market shift from the traditional coach building of 65-seater locally-assembled inter and intra city and rural buses for public transport to the 15-seater imported kombis and fleets of second hand ex-Japan vehicles now plying the roads, of which 62 000 were estimated to have been imported last year alone , compared to zero in say 1997,” Mr Ndudzo said.

The disposal of Deven Engineering is aimed at raising funds for new ventures and will see the sale of Motec’s 100 percent of the issued share capital in the coach building business.

Deven will continue on the new site to rehabilitate the old fleet as and when demand arises and also to offer development engineering and fabrication services to industry and the mining sector.

“WMMIDeven will investigate the feasibility of assembling such small buses in future and Deven will continue with the importation of the Yutong range of new public transport buses as a transitional measure to stay in business on a very much smaller staff compliment than before, which is unfortunate, but a necessary adjustment to the rapidly changing market dynamics and preferences since dollarisation. There is adequate space at WMMI for this activity,” Mr Ndudzo said.

The company is considering share sale or asset sale which includes land, buildings and equipment.

“Proceeds of the sale will be utilised to fund new ventures in line with the IDC’s mandate that entails establishing new industries and facilitating, guiding and promoting the financing reorganisation and development of existing industries,” the IDC said.

The IDC is in the process of scouting for partners to either mine or process lithium ore into other value-added products such as batteries, among other projects.

CorporateExcellence are the financial aisors in the deal.

Source : The Herald