HULISANI

Finweek English Edition - - FRONT PAGE -

Hav­ing only listed on 7 April it may be rough to al­ready sug­gest a sell here, but hear me out.

Hulisani is a Spe­cial Pur­pose Ac­qui­si­tion Com­pany (SPAC) with a net asset value (NAV) of R10 a share, but is trad­ing around R17 as I write this. That NAV is only cash, so this is a mon­ster pre­mium.

A SPAC in­tends to buy into a com­pany and will then move to the JSE main board, con­tin­u­ing busi­ness as the com­pany it has ac­quired. In the case of Hulisani, it’s look­ing at the energy sec­tor in South Africa and the broader South­ern African Devel­op­ment Com­mu­nity (SADC) re­gion.

On the sur­face, this is su­per ex­cit­ing. Fur­ther, it has the Eskom Pen­sion and Prov­i­dent Fund and Gov­ern­ment Em­ploy­ees Pen­sion Fund – hold­ing just un­der 50%.

But hav­ing a pile of cash, great share­hold­ers and an im­pres­sive look­ing board op­er­at­ing in a hot space does not en­sure any­thing. Hulisani still has to iden­tify and buy the right asset, and then it has to make prof­its. All the while share­hold­ers are pay­ing a pre­mium. If I could buy at around R8 I may be in­ter­ested, but oth­er­wise I’ll just watch.

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