/ 20 August 2013

Chinese shares make Naspers’s Koos Bekker a billionaire

Naspers's Koos Bekker.
Naspers's Koos Bekker. (Avusa)

Jacobus Petrus “Koos” Bekker became a billionaire earlier this year after transforming Cape Town-based Naspers from a decades-old print business into the world’s largest emerging market media company.

Formed in 1915 as De Nasionale Pers, the company published what became South Africa’s first Afrikaans-language daily newspaper, Die Burger, which went on to defend apartheid rule in commentaries and articles when the segregationist system was put in place, beginning in 1948.


Bekker, the company’s 60-year-old chief executive officer, took control of the group in 1997 and began investing in technology and media companies, according to BPI Africa Capital analyst Kate Turner-Smith. Buying stakes in more than 100 businesses, including China’s Tencent Holdings and Russia’s Mail.ru, Bekker turned Naspers into an investment house that has added almost $34-billion in market value since 2003.


“The company has changed 180 degrees,” Turner-Smith said in an interview on August 5. “Koos Bekker is quite a visionary guy. He saw the writing on the wall with print media long before most of the market did and started investing in internet businesses.”

Babylonstoren estate
Bekker takes his compensation in stock alone, and controls almost 4% of Naspers through a combination of 11.7-million share options he holds directly and a 1.1% stake held by a family trust. Measured in local currency, Naspers shares have risen 30-fold since 2003, making it the best- performing stock on the JSE, and pushing up the value of Bekker’s personal holdings in the company to $1.2-billion.

With his wife, Karen, he also owns Babylonstoren, a 200-hectare farm, winery and luxury hotel about 60 kilometres north-east of Cape Town. The property is valued using information provided by two local real estate agents familiar with the property and its history. Local property records show he bought the estate in 2007 for R35-million.


Through a company spokesperson Meloy Horn, Bekker declined to comment on his net worth.

Naspers had R50.2-billion in revenue in the fiscal year ended March 31 2013, 60% of which came from pay television. More than 6.7-million households from South Africa to Nigeria paid to watch content on Naspers’s broadcaster, Supersport, including soccer’s English Premier League and Formula 1 car races.

TV thesis
The Potchefstroom-born Bekker focused his thesis at Columbia Business School, in New York, in the 1980s on pay-television businesses such as Time Warner’s HBO, then an emerging business model.

In sub-Saharan Africa, Supersport is the largest broadcaster of soccer matches in Africa, according to Horn, a boon in a region with millions of fans, including Bekker, who was a member of South Africa’s 2010 FIFA World Cup organizing committee.


After graduating from Columbia in 1984, Bekker returned to South Africa, where he recruited several media companies, including the Naspers publishing house, to serve as one of the founding shareholders of pay-television company M-Net.


M-Net sold shares on the then Johannesburg Stock Exchange in 1990, and was delisted and consolidated under Naspers after Bekker was named chief executive in 1997.

Emerging markets
Four years later, Bekker made one of his early emerging market investments, buying half of Shenzhen, China-based Tencent, now the country’s biggest internet company, for $32-million.

The stake was diluted to 34% after Tencent’s 2004 listing on the Hong Kong stock exchange and the introduction of a share incentive plan, and represents about 80% of Naspers value, according to Turner-Smith.


Tencent’s stock has soared 49% this year through yesterday, defying an 11% drop in the MSCI Emerging Markets Index, and a 1% decline in the Hang Seng Index, in the same period. Naspers shares are up 58% since January.


On Tuesday, Tencent slipped 1.4% to HK$365 at 3:33 pm in Hong Kong trading. Naspers dropped 0.6% to R852.30 in Johannesburg.


“Naspers and Tencent are almost identical,” said Turner- Smith, referring to performance of the company’s shares. “Bekker’s wealth is the effect and the cause is Tencent. He was a smart guy; he had his finger on the button very early.” – Bloomberg