SUPPORT AND SPECULATION
AFTER SOME RATHER DISAPPOINTING interim results to end-February, the price of Sekunjalo Investments has seemingly found a range between 60c and 65c/share. A recent cautionary notice hasn’t exactly ignited market interest, but it has certainly sparked a good deal of speculation.
As such, Sekunjalo – as a speculative flutter – is perhaps worth bagging at such levels, bearing in mind directors have been full of promises about unlocking value for shareholders. Four possibilities could be covered by the cautionary. The first is the promised listing of Sekunjalo’s informatics division, which was initially set for first half 2008. Frankly, if that division hasn’t listed by now, it’s probably safe to assume – noting the jittery stockmarket conditions – that the listing won’t happen this year.
The second is the listing of biotechnology company Bioclones (controlled by Sekunjalo) in London or on the Nasdaq. That also seems unlikely over the short term.
The third possibility is that the control structure held in Sekunjalo Investment Holdings will be dismantled or adapted. The big outcome here could be injecting the holding company’s valuable stake in technology group Siemens SA into the listed vehicle.
The fourth possibility is that Sekunjalo founder and former CEO Iqbal Survé – who has been buying shares by the bucket load on the open market – is going to initiate a buyout of minorities.
And then Finweek has also heard talk – so far unsubstantiated – that the cautionary refers to a possible deal with British Telecoms (BT) that covers expansion into SA. That would fit Sekunjalo’s stated strategy of chasing empowerment arrangements with larger corporate entities.
Clearly, there’s enough to keep punters interested – and possibly reap the reward of medium-term value unlocking and deal flow. Apart from the flurry of speculation there are also fundamental issues to consider for soon-to-be-published results to endAugust 2008 – the most important being whether Premier Fishing can return to profitability in the second half.