Naspers CEO marks ‘sev­eral bil­lion’ for tech in­vest­ments

Mint ST - - TECHNOLOGY - BY GILES TURNER feed­back@livemint.com LONDON

Naspers Ltd is keen to con­tinue its search for e-com­merce and tech in­vest­ments, with Africa’s big­gest com­pany happy to de­ploy a siz­able war chest in its hunt for deals.

“We have sev­eral bil­lion in cash and un­der­uti­lized credit fa­cil­i­ties,” Naspers chief ex­ec­u­tive of­fi­cer (CEO) Bob Van Dijk said in an in­ter­view with Bloomberg. “We have room to in­vest in the fu­ture.”

Naspers has be­come one of the world’s largest in­vestors in e-com­merce ven­tures, as well as Africa’s largest pay-tv provider, as it tries to build on the suc­cess of its early stage in­vest­ment in Chi­nese tech­nol­ogy gi­ant Ten­cent Hold­ings Ltd—a com­pany now worth $472 bil­lion.

“In time, Naspers could be­come an even bet­ter in­vest­ment al­ter­na­tive than Ten­cent,” said Ger­rit Smit, head of Stone­hage Flem­ing Eq­uity Man­age­ment.

“Naspers is cur­rently in a heavy in­vest­ment cy­cle and spend­ing money on build­ing sub­stance in emerg­ing mar­ket e-com­merce and other on­line busi­nesses.”

Van Dijk has been ac­cu­mu­lat­ing in­ter­net tech­nol­ogy ac­qui­si­tions since tak­ing the helm from chair­man Koos Bekker in 2014. Over two rounds in May and Septem­ber, Naspers in­vested €1.05 bil­lion ($1.2 bil­lion) in Ger­many’s De­liv­ery Hero AG, and has been in­volved in 14 deals worth $1.94 bil­lion this year alone, ac­cord­ing to data com­piled by Bloomberg.

Much of this deal spree has been funded by the sale of Pol­ish on­line auc­tion site Al­le­gro for $3.25 bil­lion last year. Al­though Van Dijk added that fu­ture in­vest­ments will be “op­por­tunis­tic,” there is no in­di­ca­tion spend­ing will slow down.

“We’ve been tra­di­tion­ally been fo­cused on growth mar­kets,” he said. “That’s still true. But on the other hand we are look­ing at growth op­por­tu­ni­ties re­gard­ing ge­og­ra­phy.”

Naspers’ ven­tures arm, with of­fices in Am­s­ter­dam, Delhi and San Fran­cisco, has been busy col­lect­ing e-com­merce com­pa­nies.

In­vest­ments this year in­clude lead­ing an $80 mil­lion in­vest­ment in In­dian food or­der­ing and de­liv­ery plat­form Swiggy in May, and in Jan­uary lead­ing the $175 mil­lion fund­ing round in Letgo, the US on­line used goods mar­ket­place.

Al­though in dif­fer­ent ge­ogra­phies, many of Naspers’ in­vest­ments fo­cus on sim­i­lar sec­tors, such as Letgo and De­liv­ery Hero.

Van Dijk said that he might look at con­sol­i­dat­ing some of these in­vest­ments, if the “op­por­tu­nity came up.”

Along­side e-com­merce, Van Dijk flagged fin­tech as a par­tic­u­lar area of fo­cus. In Oc­to­ber Naspers an­nounced that its fin­tech in­vest­ment di­vi­sion Payu led a $115 mil­lion in­vest­ment round in Remitly, a dig­i­tal re­mit­tance start-up in the US.

Not every­one thinks con­tin­u­ing its ven­ture cap­i­tal spree is the best al­lo­ca­tion of Naspers’ re­sources. In­stead it should buy back its own shares to take ad­van­tage of the dis­count be­tween its share price and the value of its stake in Ten­cent, ac­cord­ing to vet­eran emerg­ing mar­kets in­vestor Mark Mo­bius.

“The sit­u­a­tion right now is that all the in­ter­net com­pa­nies are very pricey,” Mo­bius said.

BLOOMBERG

BLOOMBERG

Naspers chief ex­ec­u­tive of­fi­cer Bob Van Dijk.

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