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Small Related Party Transaction – Lease Renewal
HUDACO INDUSTRIES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1985/004617/06)
Share code: HDC & ISIN: ZAE000003273
("Hudaco" or the "Company")
SMALL RELATED PARTY TRANSACTION – LEASE RENEWAL
1. INTRODUCTION
Shareholders are advised that Hudaco Trading (Pty) Limited, an 85% held subsidiary of Hudaco, via
its Ambro Steel division ("Ambro Steel"), has renewed its lease agreement (the "Lease Agreement")
with Dufomo Investments (Pty) Ltd ("Dufomo") in terms of which Ambro Steel will continue to lease
premises located at the corner of Lamp and Snapper Roads, Wadeville, Germiston (the "Premises")
from Dufomo as set out in section 3 below (the "Lease Renewal").
Mr GR Dunford, the chief executive of Hudaco, is an 82% shareholder of Dufomo, which owns the
Premises. Accordingly, Dufomo constitutes a related party to Hudaco and the Lease Renewal
constitutes a small related party transaction in terms of paragraph 9.1 of the JSE Listings
Requirements.
2. RATIONALE FOR THE LEASE RENEWAL
The rationale for the Lease Renewal is to provide continuity to Ambro Steel's business, being the
storage, cutting and sale of steel and related products. The buildings and structures on the Premises
were purpose-built to suit the operations of Ambro Steel, which already occupied the Premises prior
to being acquired by Hudaco during 2008. The Premises provide Ambro Steel with the cranage and
heavy-duty power that it needs to operate. Alternative properties with the appropriate installations are
difficult to source. The Premises are located in the well-established industrial node of Wadeville, which
is accessible to Ambro Steel's customers and staff.
3. DETAILS AND TERMS OF THE LEASE RENEWAL
In terms of the Lease Agreement, Ambro Steel will continue to lease the Premises, comprising office,
factory and warehouse space, measuring 5 662.5m2 in total lettable area, for the period of five years
from 1 March 2026 ("Initial Period") with an option to renew at least 6 calendar months prior to the
termination of the Initial Period, for a further 5 years at a market related rental to be determined at the
time. The monthly rentals payable in respect of the Premises for the Initial Period, which includes an
annual escalation of 7%, are set out in the table below:
Period Monthly rental
(Rands excluding VAT)
1 March 2026 to 28 February 2027: 319 472,31
1 March 2027 to 29 February 2028: 341 835,37
1 March 2028 to 28 February 2029: 365 763,85
1 March 2029 to 28 February 2030: 391 367,32
1 March 2030 to 28 February 2031: 418 763,03
There are no outstanding conditions precedent relating to the Lease Renewal.
4. FINANCIAL INFORMATION
Hudaco incurs lease expenses of the amount set out in paragraph 3 above. The rental payable is
deductible for tax purposes. Except for a right-of-use asset determined in terms of IFRS 16, there are
no assets attributable to the Lease Renewal.
5. INDEPENDENT DIRECTORS' STATEMENT
The Company followed an objective process in respect of the Lease Renewal and ensured that there
was no undue influence by Mr Dunford in respect of the outcome. The Independent Directors of the
Company furthermore considered the terms of the Lease Renewal and confirm that:
• the terms of the Lease Agreement were concluded on an arm's length basis in the ordinary
course of business and on normal commercial terms which are standard for an agreement of
this nature; and
• the Lease Renewal is fair to shareholders of the Company, excluding the related party and its
associates.
In reaching this conclusion, the Independent Directors took into account, inter alia, comparable market
pricing compiled by an independent property expert who conducted a market assessment and the
underlying commercial rationale.
6. AVAILABILITY OF THE LEASE AGREEMENT
In accordance with paragraph 9.3(a) of the Listings Requirements, the Lease Agreement will be
available for inspection for a period of 14 days from the date of this announcement at the registered
office of the Company, Building 9, Greenstone Hill Office Park, Emerald Boulevard, Edenvale, for a
period of 14 days from the date of this announcement and may be obtained on request from Hudaco's
Group Company Secretary at hudaco@acorim.co.za.
Johannesburg
5 June 2026
Corporate advisor and sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Date: 05-06-2026 02:35:00
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