Rupert the bear on the prowl
REINET INVESTMENTS, the new Luxembourg-based investment fund offered to shareholders of Richemont and Remgro, couldn’t have timed its launch any better. Reinet, which released its prospectus last week, will start scouring for opportunities at a time when asset values across the board have been smacked silly by the prevailing financial crisis.
The prospectus sketches a very broad investment mandate – including allowing for gearing (an anathema in the cash-flush Rupert companies), the use of derivatives and currency hedges.
Reinet will initially comprise a holding of 3% to 4% of British American Tobacco (BAT), along with around R4bn in cash and smaller investments inherited from Richemont.
Unfortunately, there’s a paucity of information in the Reinet prospectus about the smaller investments inherited from Richemont, which amount to a not insubstantial €55m (R600m). Its prospectus also doesn’t make it clear whether the significant minority holding in BAT is a strategic investment for the longer term or merely a short-term position that will be liquidated to build funds for new opportunities.
But the bottom line is that Rupert family ventures (be it Richemont or VenFin) have created huge value for shareholders. As such, Reinet offers investors a triple whammy: excellent track record in building longterm value. vehicle at a time when plenty value laden opportunities exist globally. mally be available to ordinary investors in SA.