Naspers to spin off, list MultiChoice next year

Naspers unveiled plans on Monday to spin off and list separately its pay-TV unit MultiChoice, its first major move aimed at narrowing a discount between its market value and the value of its stake in Chinese technology giant Tencent.

Founded more than 100 years ago in Stellenbosch, Naspers has transformed itself from a newspaper publisher into a $94bn (R1.4 trillion) behemoth but it owes all of that valuation to its one-third stake in Chinese internet and gaming group Tencent.

The Tencent stake is worth about $155bn (R2.3 trillion), or 65% more than Naspers, despite the company owning other assets such as MultiChoice, a de facto monopoly in Africa.

The discount has prompted some investors to urge CEO Bob van Dyk to find ways to narrow it. MultiChoice is expected to list in Johannesburg in the first half of 2019, and be hived off with limited debt to enable it to pursue growth opportunities in Africa, Naspers said.

This raised hope among shareholders that it could be the precursor to further splits within the top-heavy group‚ including the possible unbundling of its money-spinning interest in Tencent.

However‚ it will retain its primary listing on the JSE, and its interests in Media24.

“Will this address the discount? We mentioned earlier that there are several structural options that we’re considering.

“This is one of them. We think it will crystallise value for shareholders,” Van Dyk said.

The Multichoice business will be spun off to existing shareholders.

It could be the precursor to further splits within the top-heavy group