Not on a trade hold
Chairman Wiese spends walloping R30m buying share on open market
IT WOULDN’T be an unreasonable expectation for Tradehold to mobilise its freshly raised R650m for some inspired deal-making after chairman and prime mover Christo Wiese snapped up nearly R30m worth of shares on the open market. Only a few months ago the retail tycoon – as main shareholder and underwriter – poured in several hundred million rand into Tradehold’s rights issues. What’s another dollop of cash to one of SA’s wealthiest businessmen?
But why Tradehold? Unlike Brait SA – where Wiese is also ensconced – Tradehold can’t be regarded as the most exciting share on the JSE. Apart from its cash pile and a few shares in Swiss bank UBS, Tradehold holds two investments: 85% of Britishbased property specialist Moorgarth and a 15,9% stake in unlisted retailer Instore (the value of which can’t easily be quantified). With a market capitalisation of just R850m, we’re not exactly talking Capital Shopping Centres, Capital & Counties… or even Redefine International.
But Tradehold could get a tad more exciting as it scours the moribund British property market for bargain basement priced deals (albeit that process might not unfold terribly quickly).
Of course, there are still some excitable punters speculating hopefully that Tradehold may well have a broader scope (think Wiese’s array of personal investments on the JSE). But perhaps we shouldn’t get too carried away. Although he’s probably SA’s best loved serial risk-taker, Wiese may simply have latched on to some decent value in Tradehold in the prevailing market weakness.
Just before Wiese’s R30m spree, the Tradehold share – recently subject of a 10-to-one consolidation – plunged down to 450c in small volume trade. The sometimes dramatic effects of share consolidations on share prices are well known and such freak or panic trades can really see market value hammered. Luckily for the deep-pocketed Wiese, a big shareholder – or shareholders – appeared to have been spooked. Paying an average 600c/share, Wiese bought shares that not only carry an intrinsic net asset value of around 680c/share but may well also benefit from some well-timed corporate manoeuvres.