Consol: holiday may delay stock listing

South Africa“s Consolidated Glass (Consol), the packaging division of listed diversified food group AVI, will list on the JSE (Johannesburg Stock Exchange) Securities Exchange in the last week of Feb…

South Africa“s Consolidated Glass (Consol), the packaging division of listed diversified food group AVI, will list on the JSE (Johannesburg Stock Exchange) Securities Exchange in the last week of February 2005, but this could be put back until 5 March because of the exchange“s three-week break at the end of 2004, said managing director Mike Arnold on 30 November 2004. However, the listing would definitely go ahead before AVI published results in March 2005. Consol, which was previously listed, was absorbed by AVI in 1998 when it ran into difficulties. Sam Denoon-Stevens, AVI“s investor relations manager, said these problems had now been put right and Consol was ready to go it alone again. “AVI is no longer a good parent for Consol as Consol“s growth strategy includes expanding into Africa, which is not part of AVI“s vision,” Denoon-Stevens said. Arnold said Consol would be unbundled from AVI through a one-for-one share split. This means all AVI shareholders will get Consol shares. Consol will have a 100% free-float. “Consol will be completely independent from AVI,” Arnold said. “A new board will be appointed, but management will remain the same.” Institutional investor Old Mutual owns between 4% and 5% of AVI. The Public Investment Commissioners, which manages South African government employees“ pension funds, has 11%. Consol makes 627,000 tons of glass a year, accounting for 88% of its sales and 95% of its profit. With a market share of 75%, it is the leading South African glass manufacturer. Its largest competitor is Nampak Glass. Consol also produces plastic, which accounts for 12% of its turnover and 5% of its profit. Since 2000, Consol has grown its turnover from ZAR 1.2 billion to ZAR 2.1 billion through volume growth. Arnold said there were substantial growth opportunities in the wine industry and in the changeover of other food and beverage containers to glass. “Growth for Consol Glass across all its categories will also be driven by increased volumes in major upstream markets as a result of gross domestic product growth,” Arnold said.