OWN CORRESPONDENT, Johannesburg | Thursday
THE South African Competition Tribunal has approved a multi-billion dollar bid for diamond giant De Beers, the company announced Thursday.
“That clears the last regulatory hurdle for the takeover to go ahead,” said a spokesman.
Investors were meanwhile positive but careful after an announcement by a major American shareholder that it would not oppose the bid, stockbrokers and analysts said.
Brandes Investment Partners, which had been one of the strongest critics of the deal, backed off Wednesday, saying it would not oppose the proposed $18,7-billion bid by a consortium led by Anglo American and the Oppenheimer family.
“The South African markets are careful but reacted positively to the announcement,” said Johannesburg-based stockbroker Andile Mazwai.
“The fact that the discount (the difference between the current share price and the implied offer price) was almost zero means that investors believe the deal should go through,” he said.
Shareholders in De Beers will vote on the bid for the diamond giant on May 18. Anglo American is not allowed to vote at the meeting in Johannesburg where a 75% vote in favour of the deal is needed for it to go ahead.
DB Investments announced a new offer — of two dollars more per share — on April 26, bringing the value of the proposed deal to $18,7-billion. The initial offer was worth $17,6-billion.
The nod from Brandes — which until this week opposed the deal along with fellow US investor Southeastern Asset Management — drove De Beers’ share price to a new record high of 345 rand (43 dollars) on the Johannesburg Stock Exchange on Wednesday.
De Beers shares on the JSE closed at R341,20 , some R6 off the implied offer price at around R347 per share.
The rand also strengthened, reaching a two-month high against the greenback at R7,91 before closing at R7,99 to the dollar. The bidding consortium DB Investments comprises Anglo American with 45%, South Africa’s Oppenheimer family with 40% and the Botswana-based Debswana, a joint venture between De Beers and the Botswanan government, with 15%.
If the bid is approved, it will turn De Beers into a private company run by the Oppenheimer family.
The landmark deal plans to unravel complex cross-stakes which De Beers and Anglo American have held in each other for three-quarters of a century — holdings that were highly unpopular with shareholders.
ZA*BUSINESS:
Tribunal to eyeball De Beers deal May 9, 2001
Gov ‘won’t oppose’ De Beers’ unbundling May 7, 2001
Setback to De Beers bid: report May 3, 2001
Oppenheimer family, Anglo sweeten the deal April 28, 2001
De Beers deal spooks Rand April 24, 2001
Oppenheimer seeks backing for bid April 24, 2001
Key investors reject De Beers buyout bid April 23, 2001
De Beers counsels private buy-out April 11, 2001
Do the deal, De Beers tells shareholders April 10, 2001
Arrogant Anglo adamant on De Beers price tag February 30, 2001
Feisty Anglo wont raise De Beers bid February 29, 2001
No end in sight for De Beers-US dispute February 20, 2001
De Beers agrees to $17.6bn takeover February 16, 2001
JSE glitters on back of De Beers deal February 5, 2001
Anglo wrenches jewel from JSE crown February 2, 2001
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