EASY TO LIST, BUT NOT NOW
IS VEHICLE RECOVERY SPECIALIST Tracker, which is 33,7% owned by technology investment company Venfin, ready for a separate listing on the JSE?
Tracker is performing well (headline earnings for the six months to endDecember 2006 were up 19% to R69m) on the back of a 14% increase in the subscriber base to nearly 400 000.
The performance came despite Venfin warning in its annual report last year that Tracker had noted increased competition in the stolen vehicles recovery market, which could lead to lower prices.
Venfin currently values Tracker at R556m, which infers a valuation of some R1,6bn for the group. No doubt Tracker is of the size and at the point of its growth cycle where a JSE listing could be considered.
Venfin CEO Jannie Durand says: “Obvi- ously it would be easy to list but there’s no compelling reason to do so at the moment.”
Maybe Durand has a point. Tracker – one of the Rupert family’s original venture capital investments – is a reliable cash generator and one of only a handful of such investments in Venfin’s tech-laden portfolio.
Tracker’s contribution to VenFin’s headline earnings in the interim period topped R23m, and the group paid a handsome special dividend of R133m as well, of which Venfin received R45m.
But what if competition in the vehicle recovery sector intensifies? A JSE listing could be a great platform from which Tracker could conduct corporate activity to ensure that its market position and growth prospects are not compromised.
Finweek still reckons DigiCore, the small – but highly profitable – vehicletracking specialist, would be a great place for Tracker to start looking for new opportunities.
Easy to list Tracker. Jannie Durand