Prosus plans to acquire 45.4% stake in Naspers
AMSTERDAM-BASED technology investor Prosus announced plans yesterday to acquire up to 45.4 percent of the shares in its parent, Naspers of South Africa, by issuing new Prosus shares, in a deal aimed at moving part of the value of their massive stake in Tencent to Europe from Africa.
Naspers, which has a controlling stake in Prosus and would retain control, hopes the deal will improve valuations for both companies.
Both trade at a discount to the value of the massive 28.9 percent stake that Prosus holds in Chinese software and gaming giant Tencent Holdings, worth €172 billion (about R2.9 trillion) at current market prices.
“The share offer we have announced today will extend Prosus’s standing as Europe’s largest internet company,” Bob van Dijk, the chief executive of both companies, said in a statement.
He said Prosus shareholders would benefit because the Naspers N shares Prosus would buy trade at a deeper discount to the value of the Tencent stake than Prosus shares do. In recent weeks, Naspers shares have traded at a discount of about 25 percent to the Tencent stake value, while Prosus trades at a 15 percent discount.
Naspers shareholders should see their share price trade more in line with the value of the Tencent stake, and Naspers will remain the largest company on the JSE, the companies said.
They said they expect the deal to be implemented in the third quarter of this year.
Naspers has struggled with its relative dominance on the JSE, and its shareholders have long lobbied for the company to reduce the valuation gap.
Last month, Prosus sold 2 percent of Tencent for $14.7bn (about R205.6bn), in one of the largest strategic moves since its 2019 public listing in Amsterdam – with both steps intended to manage the unwieldy Tencent stake.
The deal would increase Prosus’s float on the Euronext stock exchange to about 42.8 percent, or a 60 percent economic interest in the underlying assets, from about 27 percent at present, making it eligible for inclusion among the indices of Europe’s largest companies.
In addition to the Tencent stake, Prosus owns stakes in or operates an array of consumer internet companies, including the OLX online classifieds marketplace around the world, Swiggy in India and iFood in Latin America.