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Happiness Zengeni and Martin Kadzere
As part of its diversification plan, Innscor Africa has moved into the automotive spares sector following its acquisition of a controlling stake in Transerv. According to the group, the acquisition was concluded early this month.

“Transerv is a successful home-grown business which has expanded throughout Zimbabwe and currently operates from 32 branches in fitment centres,” the group said yesterday.

“Innscor Africa was attracted to this investment because of its superior performance, growth prospects and highly motivated management and staff.”

The acquisition follows pronouncements made by group chief executive Toni Fourie this year that the company would be active in the acquisitions market. He said in the short term Innscor would announce three acquisitions which included a business which will bring diversity and one which will complement an existing business line.

Early this month, the Herald Business reported that Innscor subsidiary National Foods is set to expand its product portfolio through the acquisition of a significant stake in a dairy and juice company, Pangolin Products.

Mr Fourie is currently leading Innscor through a re-organisation and restructuring.

“We will look to re-architect, redesign, reorganise and simplify the group to maximise efficiency and optimise opportunities over the coming three years,” Mr Fourie said.

The group plans to generate superior return on equity (ROE) in excess of 30 percent and generate free cash in excess of 60 percent of earnings before interest depreciation tax and armotisation (EBIDTA)

The group says it will efficiently deploy free cash to develop current infrastructure and acquire new infrastructure.

Innscor is currently trading under caution on the Zimbabwe Stock Exchange pending the unbundling and subsequent listing of its Quick Service Restaurants. The move will create the only listed African focused fast food chain outside South Africa and bodes well with the organisation’s thrust to grow its revenues outside Zimbabwe to a 50 percent contribution.

Innscor will use the entity to acquire businesses related to fast foods across Africa. The cluster has been opening a counter a week since January which were all self-funded.

The acquisition of Transerv is expected to integrate with the group’s distribution fleet as it will make the cost of servicing cheaper.

“The greatest difference in the new structure is expected to be in the distribution channels on which Innscor could use its vertical integration to its advantage.” Mr Fourie said distribution fleets will be consolidated and centralised at Distribution Group Africa (DGA).

Industry experts point to an accelerating growth potential within the sector supported by an increase in the vehicles on the country’s roads.

Transerv recently completed the acquisition of another local company, Zim-Midas.