Wealth Advisory Newsletter

Hersov to approach SA with R2bn bid to buy six regional airports

The government rejected an informal offer made by Rob Hersov and his business partner, Nick Ferguson, to buy six regional airports owned by the state for a “daring R2 billion”, reports IOL. Hersov, in an interview with IOL on 10 September, said they were not bidding for Airports Company South Africa (ACSA) as was rumoured but instead said his company RSA.aero would bid for regional airports.

These regional airports are George, Gqeberha, East London, Bloemfontein, Kimberley and Upington and would add to the Cape Winelands Airport RSA.aero already owns on the outskirts of Cape Town. The key point is to turn these airports into successful money-making enterprises. Hersov said he sees an opportunity to save these assets with his team which comprised of individuals with the necessary capital, skills and expertise to unlock their value.

Construction activity picks up during the second quarter

The construction sector increased its value add to 4.1% during Q2 of 2022 compared with the previous quarter. This is according to the Afrimat Construction Index (ACI) released on 12 September. The ACI is a composite indicator of the level of activity within the building and construction sectors.

At the release of the latest index, economist Dr. Roelof Botha, said the increase was despite events that put additional pressure on economic activity in the second quarter, including the KwaZulu-Natal floods, strikes at major mining companies, weaker precious metals, and iron ore prices, high fuel costs, load shedding, rail transport problems, and increasing inflation, reports IOL. “The best-performing indicator was the value of buildings completed in the metros and larger municipalities, with a 21% year-on-year rate of increase. The increase in employment in construction in the second quarter was also encouraging and will hopefully continue as the government starts embarking on more public/private partnerships as part of the promised infrastructure drive,” Botha said.

Absa funds South Africa’s first utility-scale renewable energy captive power project

The first utility-scale renewable energy captive power project which will be built in North-West province in South Africa, has been funded by Absa, reports Business Tech. The project comprising 200 MW of solar power will cost an estimated R4.1 billion.

The project comprising of two projects of 100 MW each, developed by Sola Group of South Africa CWA Power, will supply power to Tronox Holdings Plc’s South African operations, Tronox SA, under a long-term power purchase agreement. Its aim is to assist Tronox to reduce its dependence on fossil fuel power in line with its strategy to reduce carbon emissions. Shaun Moodley, principal within Absa’s Resource and Project finance team said that Absa is honoured to be a part of this project where funding is in the line with its own sustainable goals which include assisting clients on their sustainability journey to transition from fossil fuels to renewable energy sources.

Agricultural exports a bright spot in GDP gloom

The agricultural industry posted a 5% quarter-on-quarter rise in export earnings to $3.4 billion (about R60 billion). Paul Makube, senior agricultural economist at FNB Agri-Business, said this was driven by exports of citrus, apples, maize, and pears despite the storms in the second quarter.

Agbiz chief economist Wandile Sihlobo told  Business Live that citrus, pears, maize, apples, grapes, figs and dates were among the top exportable products, and he expected some of them to dominate the export list in the third quarter. After the European Union (EU) changed plant regulations, citrus continued to experience market access challenges, the impact of which will be shown in the third quarter, Sihlobo predicts. This will depend on the engagements between South Africa and the EU on the new plant safety regulations.