In­sti­tu­tions buy Novus shares

Business Day - - FRONT PAGE - Ann Crotty Writer at Large crottya@bdfm.co.za

More than 38% of print­ing group Novus Hold­ings’s shares have been placed with in­sti­tu­tions fol­low­ing im­ple­men­ta­tion of the un­bundling of Naspers’s con­trol­ling stake on Septem­ber 26.

More than 38% of print­ing group Novus Hold­ings’s shares have been placed with in­sti­tu­tions fol­low­ing im­ple­men­ta­tion of the un­bundling of Naspers’s con­trol­ling stake on Septem­ber 26.

Print and pub­lish­ing group Cax­ton has emerged as one of the buy­ers with a stake of about 5%.

The Com­pe­ti­tion Tri­bunal con­firmed the Com­pe­ti­tion Com­mis­sion’s de­ci­sion that Naspers had to re­duce its hold­ing in Novus to 19% from 66%. The tri­bunal ruled the un­bundling had to be com­pleted by around Novem­ber.

Iron­i­cally, the com­mis­sion’s rul­ing was prompted by Cax­ton, which se­cured in­ter­ven­tion sta­tus dur­ing the com­pe­ti­tion au­thor­i­ties’ con­sid­er­a­tion of Novus’s list­ing in 2015.

Cax­ton ar­gued that the list­ing con­sti­tuted a change of con­trol and had to be ap­proved by the com­pe­ti­tion au­thor­i­ties.

One in­sti­tu­tional ad­viser said In­vestec stepped in to en­sure an or­derly place­ment of the shares in a bid to avoid heavy sell­ing pres­sure, which would knock the Novus share price.

The ma­jor­ity of Naspers’s in­ter­na­tional share­hold­ers are in­vested in the com­pany to get ac­cess to Ten­cent and have lit­tle in­ter­est in any of its other busi­nesses. “The ex­pec­ta­tion was that they would just dump the Novus shares as soon as they re­ceived them,” said the ad­viser.

In­vestec or­gan­ised a place­ment of the shares at R6.15 each. The list of in­sti­tu­tional buy­ers in­cludes Al­lan Gray 5.06%, Value Cap­i­tal 5.75%, Pru­den­tial 6.4%, In­vestec 5.8%, Public In­vest­ment Cor­po­ra­tion 7.53% and Pere­grine 7.9%. Cax­ton’s stake is ap­par­ently in­cluded in Pere­grine’s block.

The Novus share price is trad­ing ahead of the place­ment price. On Thurs­day, it closed at R6.80, down on the R15 level at which it traded when it was listed in March 2015.

The print­ing group has had a tough time since it listed. Not only were there changes to its lead­er­ship dur­ing 2016, but chair­man Lam­bert Retief died in Jan­uary 2017, prompt­ing an an­nounce­ment by Me­dia24, Naspers’s wholly owned sub­sidiary, that its print­ing agree­ment with Novus would be ter­mi­nated within six months.

After JSE in­ter­ven­tion, this ter­mi­na­tion no­tice was with­drawn. How­ever, on Oc­to­ber 3, Me­dia24 again an­nounced the print­ing agree­ment would be ter­mi­nated in March 2018. The two com­pa­nies will dis­cuss the pos­si­bil­ity of a new con­tract.

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