| Friday 28 January 2022 Good morning Voornaam,
Yesterday's market news was kicked off by an early morning censure by the JSE of African Equity Empowerment Investments linked to a call option arrangement entered into in 2015 and executed in 2020. It should've been put to shareholders for approval in 2015 but was not. PSG Capital has also been censured as AEEI's sponsor at the time, with the JSE noting that PSG gave incorrect advice.
ARB Holdings has announced that it has received a firm offer from Masimong Electrical Holdings of R8 per share, which would see ARB delisted from the JSE. This is a 21.92% premium to the 30 D-VWAP calculated before the first cautionary announcement was published on 2 December. This will put ARB in the hands of a company that is 49.9% held by the Masimong Group (Mike Teke's private investment group) and 50.1% held by Sabvest Finance (Chris Seabrooke's investment group). The Burke family and associated entities hold around 63% of ARB and w ill retain this stake, so the offer is being made for the other 37% of shares in issue. There are already irrevocable undertakings in place from 69% of shareholders eligible to vote, so the deal is likely to go ahead.
Vukile has withdrawn its cautionary announcement and announced a deal in its Spanish subsidiary, Castellana Properties, in which it holds 88%. Castellana will acquire 21.7% in Lar Espana Real Estate, a fund listed on the Madrid Stock Exchange, from a Luxembourg-based private seller. Lar Espana has 14 retail assets that boast an occupancy rate of 95%. Lar Espana's loan-to-value ratio is 41%, a typical level of gearing seen in property funds.
The acquisition price is a 48% discount to net tangible assets and is expected to represent a forward yield of between 9% and 11%. The total purchase consideration of EUR 97 million will be settled by Castellana in cash. Vukile will provide Castellana with a shareholder loan o f EUR75 million, funded by the R400 million placement of Fairvest shares on the JSE this week and R840 million in proceeds from the sale of Namibian assets.
Lewis Group released a trading update for the nine months to December 2021, delivering strong sales growth of 12.7%. Cash sales were up 9.4% and credit sales increased 16.0%. Comparable store sales were up 10.3%. There's obviously a base effect in the numbers due to Covid, so the sales growth of 3.6% in the three months to December is a better number to look at. The key is that sales in that quarter were up 20.7% vs. the same quarter in 2019 when there was no pandemic. That is a very strong result supported by strong collections of debtors.
Grindrod holds an indirect 24.7% in the Port of Maputo, where a new handling record was achieved in 2021 (22.2 million tonnes vs. 18.3 million tonnes in 2020). This is in stark contrast to South African ports and especially coal terminals, which are literally costing our country billions in lost exports.
Anglo American Platinum released a PGM production report for the fourth quarter. Total production is up 3% for the quarter vs. the same period last year and 13% for the year. Base metal production (copper and nickel) increased 52% for the year. Investors should refer to the announcement for full details.
Kumba Iron Ore also released a production report, with a 9% increase in production in 2021. Both production and sales were ahead of guidance. Once again, Transnet put a dent in export growth and the result could've been even better if our rail infrastructure was working properly. HEPS is expected to be between R97.43 and R107.80, a jump of between 37% and 52%.
UK property fund Hammerson released a trading update noting that FY21 adjusted earnings should be between GBP75 - 80 million, up from previous guidance of GBP60 million. Footfall in the UK took a knock from lockdown restrictions over the festive season and sales in December were at 93% of 2019 levels. The share price jumped nearly 6%.
In addition to the usual DealMakers content on a Friday (which I highly recommend you look at), I've written feature articles on Shoprite's powerful sales update and Pepkor's trading update that shows strong momentum from December into 2022.
Enjoy your weekend
The Finance Ghost
|
|---|
|
|---|
Local and Offshore Market News |
|---|
|
|---|
| Disclaimer
Our content is intended to be used and must be used for informational purposes only. You must do your own analysis before executing any investments or strategic decisions, based on your own circumstances. We do not provide personalised recommendations or views as to whether an investment approach or corporate strategy is suited to the needs of a specific individual or entity. You should take independent financial advice from a suitably qualified individual who gives due regard to your personal circumstances.
Whilst every care is taken, we accept no responsibility or liability for any errors or omissions in any of our content.
The views, thoughts and opinions expressed in our content belong solely to the author or quoted individuals and/or entities, and not necessarily to the author's employer, organisation, committee or other group or individual, or any of our affiliates or brand partners. |
|---|
|
|---|
|
|
