Group Five division buys Intertoll stake
THE recently established structural development division of Group Five has purchased a 75% stake in international toll company Intertoll which it believes will eventually lead to a more even flow of income and offer it access to overseas markets, writes DON ROBERTSON.
The Group Five interest is held in partnership with existing senior management of Intertoll which was in the process of a management buyout from the unbundled Interpark, within the Servgro group.
The purchase price was R20-million including the loan accounts.
Intertoll is a rapidly growing toll road development and operations company with activities in Hungary, Brazil, the US and SA.
Its largest project is the development and operation of a 35-year concession for the M5 toll highway in Hungary, establishing it as a recognised international developer and operator.
Tim Woodhead, managing director of the infrastructure development division at Group Five, says the operation was created to pull together the necessary skills required to meet the new build-operate-transfer type of contract that is now gaining popularity in business deals in SA.
"To develop infrastructural programmes it is necessary to have legal skills, the ability to raise private funds, establish partnerships and have other multidisciplinary abilities.
"It was not economical to have these financial and legal skills spread throughout the group, so the decision was taken to establish the infrastructure development division," he says.
Financial director Howard Turner says the purchase is a significant step in Group Five's plan to complement construction skills with infrastructure development and operating activities. It will also give the group an entry into international markets.
Group Five will add its construction skills to any future international developments in consortiums with local developers.