With the backing of New Africa Investments Limited’s (Nail) major institutional shareholders, an empowerment consortium comprising Safika Holdings, Tiso Private Equity Fund, the Mineworkers Investment Company (MIC) and Investec Bank Limited has made a firm offer to acquire 100% of the issued share capital in Nail.
If successful the consortium, which is more than 50% owned and controlled by black groups, will review the individual assets within the Nail stable in order to identify appropriate partners where necessary.
The cash offer of R9 per share is subject to a limited due diligence investigation of Nail and certain other conditions. The offer represents a premium of 25% and 32% over the ordinary shares and the ‘N’ shares, respectively, and was calculated on the 30-day weighted average market price at close of business on 22 July 2003.
The consortium believes it will be unlocking value and resolving a complex situation for existing shareholders.
“Nail is currently involved in a long and complicated tender process. This offer simplifies and accelerates the situation from a Nail shareholder perspective, and significantly increases the level of empowerment control in the media assets” said Fani Titi, chair of Tiso Private Equity Fund and CEO of the Tiso Group (Pty) Limited.
The empowerment consortium will accept the risk for Icasa regulatory approval. Paul Nkuna, CEO of MIC and chair of Primedia confirmed that no exemptions from current Icasa regulations will be required.
“MIC welcomes the prospect of working in partnership with the consortium and believes this transaction will extract value both for our investors and current Nail shareholders.”
Moss Ngoasheng, Safika’s executive chair said that although Nail has made an invaluable contribution to empowerment over the years, empowerment models have moved on.
“The current structure was no longer benefiting empowerment and was prejudicing institutional shareholders. We are satisfied that this transaction addresses ongoing concern about black ownership in the media sector.”
Nail’s media assets include a share of radio advertising house Radmark; stakes in radio stations Jacaranda, KFM and Kaya FM; 100% ownership of Sowetan, and 50% of Sowetan Sunday World and New Africa Books.
The group also has interests in film, television and outdoor advertising. – I-Net Bridge