Lipsobex acquires remaining 30% in Boschpick Foundry & Engineering

Newcastle, KwaZulu-Natal-based Lipsobex has announced that it has acquired the remaining 30% shareholding in Boschpick Foundry & Engineering, a foundry and engineering company that it first acquired a 70% shareholding of in 2018. The agreement was concluded in mid-November 2022.

Lipsobex, established by local entrepreneurs Bongani Khumalo and Phillip Majali, is a 100% black youth owned industrial investment company backed by the IDC. With the backing of the dti’s Black Industrialist Programme and R27 million of IDC funding, the company was able to buy the majority 70% shares of Boschpick Foundry & Engineering with the understanding that the existing directors – brothers Fred, Carel and Johnny Peens – would remain with the company. This contractual obligation has now passed the set period and the brothers have decided to sell their 30% shareholding to Lipsobex but will remain available on a consultant basis.

“We had been looking for two years to find suitable partners that would offer value-add solutions that meet both ours and our customers’ business objectives,” said Fred Peens at the time, who remained on as the CEO of the company.

“Lipsobex purchased the company with the intention to develop its manufacturing capabilities and expand into industries that Boschpick does not supply, while at the same time meeting existing customers’ needs. Our agreement was that myself and my two brothers would implement a successful transitional plan so as to make sure there was no disruption during the handing over process. Bongani and Phillip are very successful businessmen but had little experience in the foundry and machining arena and it was imperative that we stay involved for many reasons.”

Carel (left) and Fred (right) Peens have sold the remaining 30% shareholding to Lipsobex, established by local entrepreneurs Bongani Khumalo (middle) and Phillip Majali

“Even though the 70% stake moved Boschpick’s empowerment status to B-BBEE Level 1, this collaboration is not just about BEE scoring,” emphasised Peens in 2018.

“Bongani and Phillip bring diversity into Boschpick’s ownership structure, but this is no superficial empowerment deal. For most of Boschpick’s history the company has been supplying components and castings into the mining and power industries, countrywide. Although still relatively young both Bongani (38) and Phillip (40) have vast experience in these industries that will facilitate our penetration even further. At this stage we have clients in all of the various minerals and resources processed in the mining industry, including coal, except gold, which we hope to make inroads into with our new partners.”

Bongani Khumalo is a local junior miner from the rural area in Utrecht, KwaZulu-Natal. He has been in the mining business for the last 15 years and is a shareholder and director in Unyezi Coal, a company based in Newcastle. He is also the chairperson of the Uitkomst Colliery board, a mine operating in the Utrecht area of KwaZulu-Natal producing thermal and metallurgical coal and is associated with Kangra Coal, MC Mining and the Menar Group.

Khumalo is additionally one of the shareholders of MC Mining – listed on the AIM, ASX and Johannesburg Stock Exchange (JSE) – a company that is an emerging developer of high-quality coking and thermal coal assets and until recently was known as Coal of Africa (CoAL), before the name change. Pan African Resources, a precious metals producer that is quoted on the London Stock Exchange and the JSE, previously owned Uitkomst Colliery. This is another company that Khumalo had a shareholding in, before it was sold to MC Mining late in 2017.

Majali, who has been in the EPC EPCM (Engineering, procurement and construction management) space for the past nine years, is also a partner and director in the Johannesburg, Africa office of Paris, France-based project management, supply chain and procurement company ETE Floex Group.

“I have always wanted to be involved in the strategic manufacturing industry and with this investment in Boschpick Engineering we, Bongani and myself as directors of Lipsobex, have achieved this ambition,” said Majali.

“We are proud to be part of the dti’s Black Industrialist Programme and with the backing of the IDC (Industrial Development Corporation) we have been able to acquire a majority shareholding in Boschpick Engineering. There are many synergies and similar pillars of success that exist between Lipsobex and Boschpick Engineering. It is our vision to grow our combined revenues through this alliance,” says Majali.

“I am from the rural area of Port St Johns, Transkei and both Bongani and myself know and understand what it means to have a business in the rural areas that supports the local rural people. We have committed ourselves to grow Boschpick, create more jobs for the Newcastle community and value for the Boschpick shareholders.”

“Additionally, the current management team of Boschpick understands that transformation and the transfer of skills is a fundamental must for businesses to strive and grow in South Africa. Fred, Carel and Johnny will continue to run the company in the successful manner that they have done over the last 43 years of the company’s existence.”

Foundry milestone
Boschpick Engineering was originally established in 1975 when the brothers’ father identified a need for an engineering company to provide quality machined components for companies in the Newcastle area. Fred Peens Senior opened up a machine shop, which is still an integral part of the business, and his sons subsequently joined the company at different time intervals.

However, the company has since changed its service offerings and today Boschpick is heavily involved in manufacturing mechanical parts, spares replacement and components for light and heavy industry, from raw castings to supplying a fully machined casting or component. The company has been able to accomplish this because in 1988 the brothers made a strategic decision to commission their own foundry.

The company concentrates mainly on the steels, which make up about 70% of production. The remaining 30% is made up of cast iron and SG castings. Boschpick have also cast specials that include 26% chrome and manganese.

Since Fred Peens Senior retired, the brothers have broadened and diversified the base of their clients and are no longer dependent on the needs of the few well serviced clients who had become reliant on the quality of the castings supplied by Boschpick. The company now supplies castings nationwide, fully machined where contracted.

Khumalo takes up the story. “When we acquired a majority shareholding in the company, we kept on the Peens family to guide us through our ‘learning curve’. Fred stayed on as the CEO and I was the Chairman. Nobody had warned us of how challenging it is to run a foundry but we consolidated and maintained the high standards within the company.”

“We acquired new clients in the mining environment and we can now boast a client list that includes big name companies such as ArcelorMittal, Joy Mining, Komatsu, General Electric, Columbus and Transnet.”

“Subsequently, horrors such as the heightening of load shedding and the pandemic, have been thrown at us. As you know load shedding and a furnace do not sit comfortably together and you just hope that you do not get caught with a furnace full of hot metal.”

“The floods, the riots and the troubles at the port have all been extra challenges but we have survived and we have managed to maintain value and even make big inroads to the loan and working capital that we obtained to acquire the business.”

“When we acquired the remaining shares in Boschpick we also purchased the land and buildings from the Peens family. This was another significant milestone in the history of the company under the new management.”

“However, to maintain and grow the business we need to expand our horizons and manufacturing capabilities. Besides the foundry we also offer conventional and CNC turning, CNC milling, gear cutting, slotting and drilling and some products we manufacture include spur gears, internal gears, worm gears, internal & external splines, sprockets, new and reconditioned gearboxes, oven doors, pinion and pump housings, shafts and bearings.”

“We are limited to the size castings that we manufacture though. Currently we are looking at increasing our furnace capacity and hopefully not too far down the line new equipment for the machine shop.”

“We have appointed Jaco Landsberg as the new CEO two years ago. He has been with the company for 18 years so has plenty of experience.”

“It is imperative that the many small companies, like ours in South Africa, all survive, expand and create employment going forward. The current challenges that are being encountered, not through our own inabilities, do not make it easy though.”

For more information contact Boschpick Foundry & Engineering on TEL: 034 375 7281 or visit