Naspers asking Investec to pull ‘damaging’ analyst report

JOHANNESBURG: Naspers Ltd is asking Investec Ltd to withdraw an analyst report that it says contains errors and has damaged Africa’s biggest company by market value and its shareholders.

In the note dated Jan 22 seen by Bloomberg News, Investec analysts David Smith and Thapelo Mokonyane said Naspers should be valued at a 30% discount to its assets. That is due to a gradual increase in the number of outstanding shares over 11 years, taxation issues and costs associated with financial transactions, referred to in the report as friction costs, they said.

“While we believe that everyone is entitled to their views, the Investec report on Naspers contains factual inaccuracies and misleading information,” Meloy Horn, head of investor relations at Naspers, said in an e-mailed response to questions about the note.

“The report is causing us and shareholders significant damage. We will therefore be writing to Investec and formally ask them to withdraw the report and correct these matters.”

Investec and the analysts declined to comment. The Johannesburg-based lender’s “hold” rating is the only one out of 16 analysts tracked by Bloomberg, with all others a “buy”.

Naspers stock, which accounts for almost a fifth of the weight of the Johannesburg stock exchange All Share Index, has fallen more than 16% since the report was released and is trading at a four-month low.

About 200 billion rand (US$16.6bil) has been wiped off the value of the company in six consecutive trading days of declines. The shares closed 3.9% lower at 3,120 rand in Johannesburg on Monday. — Bloomberg