Chance to reach crit­i­cal mass

Finweek English Edition - - Marketplace Simon Says -

Pur­ple Group an­nounced a R100m deal with San­lam In­vest­ment Hold­ings (SIH) that sees San­lam tak­ing a 30% stake in the con­trol­ling com­pany for Easy Eq­ui­ties. There are a num­ber of terms and con­di­tions for the deal but it is good news for fans and clients of Easy Eq­ui­ties. It is grow­ing but not fast enough, and could po­ten­tially run out of money. This deal gives it another three years to get to crit­i­cal mass and be­come prof­itable. The time pe­riod is im­por­tant as San­lam has a put op­tion whereby it can sell the stake back to Pur­ple Group for the same R100m, es­sen­tially giv­ing it an es­cape clause and defin­ing the ex­pected pe­riod by when Easy Eq­ui­ties needs to have com­pre­hen­sively proved its busi­ness model.

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