‘SOMEONE CLEARLY SEES VALUE’
THE FUTURE of a “BAT-less” Remgro also came under scrutiny at the group’s general meeting of shareholders last Tuesday. Corporate activist Theo Botha suggested Remgro’s shares would trade at a deeper discount to underlying net asset value after shares in British American Tobacco (BAT) were unbundled. Botha argued that because Remgro’s larg-
est post-BAT exposure was to financial services stocks (RMB and FirstRand) there was a good chance the discount to intrinsic value would widen.
Remgro chairman Johann Rupert said since the announcement of the unbundling of BAT the JSE all-share index had dropped 26% while Remgro had dropped just 2%. “Somebody clearly sees value somewhere… Quite frankly, discounts to NAV don’t bother me… sustainable cash flow is far more important.”
Rupert added it was also important for Remgro to keep its costs under control. “As I’m the largest shareholder I’ll make sure costs are kept under control.”
Rupert also refuted Botha’s suggestions that Remgro would sell certain assets to newly created Reinet Investments. He said there were no plans at this stage to sell any of Remgro’s assets to Reinet Investments. “I can’t think of any Remgro assets that would naturally fit into Reinet Investments.”