Naspers and Prosus are to unwind the complex cross-holding structure implemented (against public opinion) in 2021 which aimed at reducing the weighting of Naspers on the JSE and to reduce the discount at which the stocks trade to their respective net asset value. The structure, implemented by way of a share swap, saw Prosus issue shares to acquire c.45% of Naspers. However, reducing the discount continued to prove difficult with management launching an open-ended share repurchase programme which proved more successful. There is, however, a limit under the South African Companies Act as to the amount of Naspers shares that can be acquired. The proposed unwind will result in Naspers owing 43% of Prosus N ordinary shares with a voting interest of 72%. This will remove the limitation and enable the repurchase of shares to continue at the Naspers level – the limitation does not apply at the Prosus level.
As part of its capital optimisation strategy, Investec Ltd acquired on the open market a further 624,947 Investec Plc shares at an average price of 432 pence per share (LSE and BATS Europe) and 419,003 Investec Plc shares at an average price of R105.82 per share (JSE).
A number of companies listed on one of South Africa’s Stock Exchanges have initiated share buyback programmes and each week update shareholders. They are:
Mantengu Mining has announced its intention to buy-back up to 10 million of its listed ordinary shares through its wholly-owned subsidiary Langpan Mining. The share which was trading at R1.70 at the time of the announcement is, according to the Board, significantly below the intrinsic value of R5.55 the share is worth.
Afrimat has repurchased 2,828,790 shares at a price of R53.03 per share from Afrimat Management Services (AMS). The shares were acquired by AMS in anticipation of the issuance of Afrimat shares for partial settlement of the Glenover acquisition. The shares have been delisted from the JSE.
Despite a difficult year, PPC’s operations in South Africa and Botswana reached an optimal level of gearing allowing for the implementation of a new distribution policy. The board has, as a result, approved a distribution in the form of a share repurchase of up to R200 million.
Sanlam has repurchased 31,305,943 shares at a repurchase price of R59.71 per share for an aggregate R1,8 billion. The company has applied to the JSE for the cancellation and delisting of the treasury shares.
Investec’s share repurchase programme has been renewed and commenced on May 30. The programme will end on or before September 29. This week 412,754 shares were repurchased at an average price per share of R106.22. Since November 21 ,2022, the company has repurchased 11,903,329 shares at a cost of R1,27 billion.
This week Glencore repurchased a further 14,700,000 shares for a total consideration of £64,49 million. The share repurchases form part of the second phase of the company’s existing buy-back programme.
Prosus and Naspers continued with their open-ended share repurchase programmes. During the period 19-23 June 2023, a further 2,144,444 Prosus shares were repurchased for an aggregate €140,8 million and a further 532,426 Naspers shares for a total consideration of R1,7 billion.
Two companies issued profit warnings this week: PPC and Crookes Brothers.
Four companies issued or withdrew a cautionary notice: Attacq, African Equity Empowerment Investments, Life Healthcare and Chrometco.
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