In a move that highlights the ongoing challenges facing the Johannesburg Stock Exchange (JSE), three prominent companies have announced their intentions to delist. Sasfin Holdings, Bell Equipment, and TeleMasters Holdings are preparing to exit Africa’s largest Stock Exchange.
Sasfin Holdings is the latest to announce its exit from the JSE, with a planned delisting aimed at refocusing its business strategy. On July 15, 2024, Sasfin made an offer to minority shareholders, valuing the company at R969 million. The offer, funded by Sasfin’s largest shareholders, Unitas Enterprises and Wiphold, provides a 65% premium to the 30-day volume-weighted average price.
CEO Michael Sassoon emphasized the need to simplify the group and concentrate on core businesses. “The backing of our major shareholders and management team will assist in rolling out our future strategy for the business,” he said.
The company’s recent restructuring included the sale of its capital-equipment and commercial-property finance businesses to African Bank in February, and the exit from specialized lending and foreign-exchange operations.
Sasfin’s delisting also comes in the wake of a R4.87 billion damages claim by the South African Revenue Service (SARS) over allegations of money laundering and bribery involving former employees. While Sasfin rejects the claims, the ongoing legal battle has undoubtedly influenced its decision to delist.
Bell Equipment, South Africa’s only major designer and manufacturer of heavy equipment, has also announced its intention to leave the JSE. The move follows a buyout offer from the founding Bell family’s investment holding company, IAB. Shareholders representing approximately 15.05% of Bell’s shares will be offered R53 per share, a 71% premium to the closing price on July 11.
IAB is an investment holding company owned by representatives of the founding family and affiliates of Bell Equipment. IAB’s decision to delist Bell Equipment is driven by the need for greater flexibility and agility in an increasingly competitive global market.
The company stated that remaining listed provides limited value, as the benefits of liquidity and capital raising are outweighed by the costs of compliance. “In the unlisted environment, the board and management will be able to take a longer-term view, particularly where strategic decisions are unlikely to yield positive short-term financial results,” IAB explained.
TeleMasters Holdings, a prominent telecom company, announced earlier this month that its two largest shareholders have been approached by an interested party looking to acquire their shares. The acquiring entity, whose identity remains confidential, must complete various regulatory processes before making a formal offer.
If the deal is finalized, it will result in a change of control and a mandatory offer to the remaining shareholders. TeleMasters advised shareholders to exercise caution while trading their securities until further announcements are made. Founded in 2001 and listed in 2007, TeleMasters has over 57 million shares in circulation and has consistently traded profitably since its inception.
The departure of Sasfin, Bell Equipment, and TeleMasters from the JSE is part of a broader trend affecting the exchange. Over recent years, several high-profile companies, including Distell and Pioneer, have been acquired by foreign investors and subsequently delisted.
While some potential new listings, such as WeBuyCars, Cilo Cybin, and Rainbow Chicken, have provided a glimmer of hope, the overall trend of delistings remains a significant concern.
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