Finweek English Edition - - Companies & markets - EDITED BY MARC HASENFUSS


SHIP­PING AND lo­gis­tics spe­cial­ist Santova (for­merly Spec­trum Ship­ping) has cel­e­brated its new cor­po­rate iden­tity with an ac­qui­si­tion.

It’s not a par­tic­u­larly size­able cor­po­rate event at Santova, which has bought a small UK-based cus­toms clear­ing and for­ward­ing lo­gis­tics busi­ness called Mo­gal In­ter­na­tional for a WHO NEEDS new gold list­ings when all the pos­si­ble fun of mar­ginal gold pro­duc­ers is to be had with DRDGOLD?

No sooner had debt-laden DRD an­nounced it had raised much-needed new fund­ing by is­su­ing shares at be­tween 540c and 580c, than the mar­ket de­cided to make an aw­fully dire pro­nounce­ment on the group’s prospects by smack­ing the share price silly.

At the time of go­ing to press DRD had crum­pled to be­low 400c, which means the poor suck­ers (who we would reckon to be rather en­light­ened in­vestors) par­tic­i­pat­ing in the re­cent shares-for-cash is­sues are feel­ing a nasty burn in the back pocket.

DRD has on nu­mer­ous oc­ca­sions been writ­ten off by sen­si­ble in­vestors, only to make a mirac­u­lous come­back in some form or other. Will it hap­pen again?

This is one of those times when only the brave and the fool­ish clam­ber in with any vigour. com­bi­na­tion of shares and cash.

About 4,8m shares will be is­sued at 10% dis­count to the 30-day vol­ume weighted av­er­age price un­til 13 March and a cash pay­ment of £86 500.

By our cal­cu­la­tions the Mo­gal deal is worth some R2m, which makes it rather noble that the ven­dors – Sher­a­ton Co­p­land-Man­der – were will­ing to take more than half the pur­chase price in shares.

Santova, which re­ally needs to beef up its cash flows to at­tract se­ri­ous in­vestors, sug­gests the deal will give it a “pres­ence” in the UK, en­abling it to con­trol and man­age the en­tire sup­ply chain be­tween SA, Hong Kong, Main­land China and the UK.

For R2m it’s de­bat­able whether Santova will be able to make this pres­ence felt on its in­come and cash flow state­ments.


IM­PRESSED? We’re blown away by the fact that Foneworx (for­merly the left-for-dead In­ter­con­nec­tive So­lu­tions) churned R9,5m in op­er­at­ing cash flow for the half-year ended De­cem­ber and posted earn­ings of more than 3,5c/ share.

And direc­tors say prospects for the full fi­nan­cial year are “pos­i­tive” and that an AltX list­ing beck­ons. With the cash pile top­ping R13m can a div­i­dend be far off?

Who said you can’t teach an old dog new tricks?

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