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Friday 13 August 2021

Good morning Voornaam,

The proposed deal between Pepkor and Cashbuild is off the table. Pepkor hoped to sell The Building Company (TBC) to Cashbuild, but the Competition Commission recommended that the transaction be prohibited. The parties couldn't agree to extend the long stop date, which is the date by which the transaction needed to be finalised. As approval had not been obtained by this date and no extension could be agreed, the transaction is now dead.

Pepkor closed 2.7% higher and Cashbuild fell 2.7%. The market clearly believes in this asset and has rewarded the company that will own it going forward.

Sticking with the building materials industry, Italtile released a further trading statement which tightened up the expected range for headline earnings per share (HEPS) growth. For the year to June 2021, HEPS will be up between 74% and 81%. The company suffered store closures during the looting and thankfully only limited damage. It has also noted that sales should benefit from customers needing building supplies for the next year to rebuild and restock their operations.

Another update came from Alviva, with the technology business reporting expected growth in HEPS of 81% to 95% in the year to June 2021. That was good enough to send the share price up by nearly 14.5%, a great outcome for shareholders.

The lead article this morning is on MTN, which has been a strong performer this year for investors. The company has indirect exposure to the commodities cycle, as it operates in countries that benefit from higher commodity prices. As a result, the share price has done well in this commodity cycle and many investors are still excited about its prospects.

To finish off InceConnect this morning, we have several articles from DealMakers. For those interes ted in corporate actions like mergers and acquisitions or capital raises, these pieces are a great way to be updated on every major corporate action in the market.

If you fancy a read on an international company, I wrote earlier this week on thefinanceghost.com about Corsair, a gaming hardware business listed in the US. I love the gaming and esports theme and I've invested in Corsair. In this article, I explain why.

It was a short but action-packed week. Have a great weekend!

The Finance Ghost

Local and Offshore Market News

MTN is yellow but the share price is green MTN has released its interim results, showing significant improvement in the balance sheet and most operations. Read More

Burger King decision raises public interest debate The recent prohibition by the Competition Commission of the proposed sale of Burger King (South Africa) on the grounds of “public interest”, has sparked lengthy debate. Read More

DealMakers South Africa M&A Analysis H1 2021 Round up of South African M&A activity for H1 2021 plus the M&A and GCF league tables Read More

Who's doing what this week in the South African M&A space? Weekly summary of Merger & Acquisition activity by South African companies Read More

Weekly corporate finance activity by SA exchange-listed companies Weekly summary of corporate finance activity by South African exchange listed companies Read More

Who's doing what in the African M&A space? Weekly summary of all Merger & Acquisition activity from across Africa (excluding South Africa) Read More

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