Prun­ing the tree JSE’s 33,5% ap­pre­ci­a­tion didn’t go un­no­ticed

Finweek English Edition - - Companies&markets -

VET­ER­ANS IN listed com­pa­nies have re­fused to waste the op­por­tu­ni­ties to make prof­its over the past six months as the mar­ket steadily stag­gered back to lev­els last seen early in 2007. As noted on this page over the past few weeks, direc­tors have been net sell­ers of their com­pa­nies’ shares and haven’t dis­ap­pointed this week ei­ther.

They all took ad­van­tage of the to­tal 33,5% ap­pre­ci­a­tion in the All-Share in­dex since April 2009, dur­ing which time the in­dex gained 6627 points to its 26 425 points (at the time of writ­ing). Many oth­ers still saw that as a buy­ing op­por­tu­nity and used it to bol­ster their hold­ings in their com­pa­nies.

This week a R58m net sale of shares added to the ap­prox­i­mately R700m net sale since mid-Au­gust. Af­ter the R73m net sale of in­for­ma­tion and com­mu­ni­ca­tions tech­nol­ogy com­pa­nies’ shares last week, this week we note an­other R29,5m net sale of shares in that sec­tor.

Cell­phone com­pany MTN’s Santie Botha was sin­gle-hand­edly re­spon­si­ble for R21,5m of that profit when she ex­er­cised her op­tions on 200 000 shares she was of­fered on join­ing the com­pany as mar­ket­ing di­rec­tor in 2003. Botha paid R16,81 be­fore dis­pos­ing of the shares for a stag­ger­ing R124,01c/share. That makes her, to­gether with col­league Karel Pien­aar (R2m profit), the lat­est in a grow­ing list of mul­ti­mil­lion­aires in the cell­phone com­pany.

Again, like their col­leagues the pre­vi­ous week, the duo took ad­van­tage of the col­lapse of the merger talks be­tween MTN and In­dian gi­ant Bharti Air­tel late in Septem­ber. Like the JSE All-Share in­dex, MTN’s share price is way past the then record lev­els seen in 2007 and is cur­rently fast ap­proach­ing those tested in the mid­dle of last year.

Direc­tors in ITC com­pa­nies Al­lied Tech­nolo­gies, Blue La­bel Tech­nolo­gies and El­lies Hold­ings made the other less sig­nif­i­cant trades to make up the bal­ance.

Vet­er­ans in other com­pa­nies, such as re­tail­ers Shoprite and Mass­mart and conglomerates Bid­vest and Stein­hoff, also sold shares to make up the to­tal R104m sale (net: R58m). Most of them ex­er­cised share op­tions granted about six years back.

Ed­u­ca­tion and train­ing spe­cial­ist Ad­vTech CE Frank Thomp­son didn’t wait to ex­er­cise any op­tions but sold 2,5m shares at the 505c/share mark. That’s also close to the same record price Ad­vTech reached in 2007 be­fore drop­ping all the way to just above 300c al­most 18 months later.

The ever-op­ti­mistic Jan­nie Mou­ton held the fort al­most on his own on the buy­ing side of the ta­ble. His R23m buy of re­cently listed Pal­adin Cap­i­tal equals half the value of the shares bought last week. Five of Mou­ton’s col­leagues also chipped in R4m fol­low­ing their re­nounce­able rights in the re­cent cap­i­tal-rais­ing ex­er­cise meant to re­alise R150m for the pri­vate eq­uity in­vest­ment com­pany and help im­prove its share free float to above the min­i­mum 20% thresh­old.

Pal­adin is now about 70% owned by the PSG Group, of which Mou­ton is ex­ec­u­tive chair­man and CE. As stated be­fore, Mou­ton is yet to sell a sin­gle share in the group of com­pa­nies. In ad­di­tion to his Pal­adin col­leagues, Mou­ton’s other col­leagues at PSG Group and Zeder In­vest­ments (an­other PSG-con­trolled en­tity) ploughed more than R300 000 into their re­spec­tive com­pa­nies’ shares. Those were, re­spec­tively, non-ex­ec­u­tive Chris Otto and Zeder CE An­tonie Ja­cobs. It seems most direc­tors in the PSG Group see any price in the mar­ket as an op­por­tu­nity to buy more shares.

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