As­sore to delist from the JSE af­ter 70 years

It an­nounced that it will de-list through a R7.8 bil­lion share buy­back pro­gramme for mi­nor­ity share­hold­ers

Pretoria News - - BUSINESS REPORT - DI­NEO FAKU di­

AS­SORE, the JSE-listed min­ing com­pany surged 81.86 per­cent on the JSE yes­ter­day to R314.25 a share as the mar­ket di­gested news of its plan to de-list from the JSE af­ter 70 years on the main bourse.

As­sore yes­ter­day an­nounced that it was best suited in an un­listed en­vi­ron­ment, say­ing that it would de-list from the JSE through a R7.8 bil­lion share buy­back pro­gramme for mi­nor­ity share­hold­ers.

“The com­bi­na­tion of this tightly held strate­gic share­hold­ing and the re­sul­tant low share liq­uid­ity, which both de­ters po­ten­tial in­sti­tu­tional in­vestors and re­sults in the share price be­ing par­tic­u­larly volatile, has led the re­main­ing share­hold­ers, the board and the in­de­pen­dent board mem­bers to be­lieve that As­sore is more suited to an un­listed en­vi­ron­ment, and that its con­tin­ued list­ing pro­vides lit­tle ben­e­fit to the strate­gic share­hold­ers,” the com­pany said.

Last year saw more than 20 com­pa­nies de-list from the JSE amid a weak eco­nomic en­vi­ron­ment.

As­sore, which is in­volved in min­ing iron, man­ganese and chrome ores, has been listed on the JSE since 1950, is 52.4 per­cent owned by Oresteel, con­trolled by the Sacco fam­ily; a 26.1 per­cent black eco­nomic empowermen­t stake, while a 4.1 per­cent stake is held by var­i­ous mem­bers of the Sacco fam­ily.

The com­pany, which op­er­ates the Ass­mang mine jointly with African

Rain­bow Min­er­als (ARM), said el­i­gi­ble share­hold­ers were al­lowed to de­cide to dis­pose of all their shares at an of­fer of R320 a share.

Seleho Tsatsi, an in­vest­ment an­a­lyst at An­chor cap­i­tal, said that the de-list­ing was good news for As­sore share­hold­ers.

“The share is tightly held with the Sacco fam­ily and As­sore’s BEE part­ner to­gether own­ing 82.6 per­cent of shares at the mo­ment. Given how tightly the share has been held it has been quite an illiq­uid share. From the Sacco fam­ily’s point of view, R330 per share looks like an at­trac­tive price at which to buy out mi­nor­ity share­hold­ers and per­haps not have to deal with the ad­min­is­tra­tion as­so­ci­ated with be­ing listed,” Tsatsi said.

As­sore in tan­dem with its com­peti­tors is grap­pling with a low bench­mark price for fer­rochrome as a re­sult of weak­en­ing global stain­less steel.

The group last month an­nounced that its head­line earn­ings a share for the six months ended De­cem­ber 2019 had plunged by 28 per­cent to R2.1 bil­lion, com­pared to R2.9bn for the year ear­lier. It said that Ass­mang had recorded head­line earn­ings of R3.7bn, down 14 per­cent com­pared to R4.3bn a year ear­lier. As­mang’s op­er­a­tions are the Beeshoek and Khu­mani iron-ore mines and Black Rock’s Nch­wan­ing and Glo­ria man­ganese ore mines in the North­ern Cape.

As­sore also op­er­ates the Dwarsriv­ier Chrome Mine in Lim­popo, whose op­er­a­tions re­ported a 68 per­cent de­cline in head­line earn­ings in the six months ended De­cem­ber 2019.


AS­SORE an­nounced that it was best suited in an un­listed en­vi­ron­ment. |

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