The Commission has recommended to the Tribunal that the proposed merger be approved, without conditions, whereby Naledi Forging intends to acquire DCD Ringrollers, a division of the DCD Group.
As part of its localisation programme the Naledi Group will invest an estimated R180 million to improve the quality systems and machining capability in the Ringrollers facility.
Naledi Forging is an exclusive and licensed distributor of imported MG Valdunes and MA steel forged wheels and related products in South Africa. It imports and supplies the South African market with solid steel forged wheels and related products. Solid steel forged wheels are a type of complete wheel that does not utilise a tyre. These products include freight and heavy haul forged wheels, passenger and locomotive forged wheels and wheel sets.
DCD Ringrollers is active in the manufacture of solid metal tyres for rolling stock. Tyres are a component of a complete wheel, where tyres are fitted onto a wheel centre to form an alternative type of complete wheel used on trains.
The wheels upon which the tyres are fitted onto are typically used in mining and industrial applications, older generation rolling stocks, and light rail applications for the metro and tram sector.
The Commission found that the proposed transaction is unlikely to substantially prevent or lessen competition in South Africa. In addition, the proposed transaction does not raise any public interest concerns.
Sibusiso Maphatiane, Executive Chairman of Naledi Inhlanganiso (Pty) Ltd making the announcement about Naledi Forging’s acquisition of DCD Ringrollers
Naledi Forging is a member of the 100% black owned Naledi Inhlanganiso Group, a 100% black owned industrial group that was established in 2013. Naledi operates in the basic iron and steel manufacturing sector, focusing its operations on iron and steel manufacturing for the rail market sector. In 2012 Naledi, through a consortium that included the Industrial Development Corporation (IDC), acquired a majority stake in the then listed Dorbyl Ltd. The only operational division in Dorbyl at the time was Guestro Automotive and Machining. The company included the existing foundry operations – Naledi Foundry – in Benoni, Gauteng, which are currently undergoing a R100 million upgrade to equipment and processes.
In 2013 Naledi submitted a bid in a public tender process for the supply of 34” cast and/or forged train wagon wheels to Transnet Engineering, a division of Transnet SOC (Transnet).
After various stages of negotiations, the bid for the manufacture of forged wheels was awarded in September 2014 and the final supply agreement was signed end of March 2015.
About DCD Ringrollers
Ringrollers is a manufacturer of railway forged tyres, exporting about 55% of its manufactured products to 42 countries. The company is ISO 9001:2000 accredited and has created a niche market for itself by adhering to strict quality control measures and standards.
The company provides a service to the rolling stock, mining and industrial markets by producing railway tyres and tram tyres for long-distance national railways, underground railway tyres for different types of mining operations and light railway tyres for the metro and tram sector.
The company also supplies specialised flanges and forgings for petrochemical and other industrial concerns, including large project-based contracts for fabricators and project engineers. The engineering industry in general benefits from a variety of forged products such as seamless steel rings used for bearings and gear blanks, off-road vehicle rims, wind tower flanges and components for general industrial applications.
The company is OHSAS 18001 accredited and also carries product accreditation from numerous organisations including British Rail, Deutsche Bahn, Aramco and the American Petroleum Institute (API).
R380 million to expand forged-products capacity
In 2012 DCD invested in a new R380 million manufacturing facility in Vereeniging to serve its forged-product operation, DCD Ringrollers.
The 14 000m² plant increased production capacity for all forged steel, carbon and alloy products by 50% to 30 000 tons per year.
Investment in machining capacity at Naledi Ringrollers
As part of its localisation programme the Naledi Group will invest an estimated R180 million to improve the quality systems and machining capability in the Ringrollers facility. This investment will ensure viable production of quality products to the African and international markets.
For further details contact Naledi Forgings on TEL: 011 845 1546 or visit www.ni-forge.co.za