Naspers, Africa’s largest media group that owns nearly a third of Tencent, said that it would spin off its holding in the Chinese internet group and other international investments in a European listing.
Johannesburg-listed Naspers said on Monday that it will list the vehicle on the Euronext Amsterdam no earlier than the second half of the year after obtaining approvals from South African regulators.
Naspers is expected to own 75 per cent of the new company after the listing, which will include its stakes in Russia’s mail.ru and India’s Swiggy among other global digital and ecommerce businesses.
The as-yet unnamed group will create “Europe’s largest listed consumer internet company by asset value” and will also have a secondary listing in Johannesburg, Naspers said.
The European asset unbundling however has been driven by Naspers’ 31 per cent stake in Tencent. One of the most lucrative tech investments in history, the stake has made Naspers Africa’s biggest company by market value. But it is rated by investors as worth tens of billions of dollars more than Naspers’ other businesses combined.
The company has come under rising pressure to reduce the discount and structural factors driving it. The Tencent stake’s rising value has increased the weighting of Naspers to a quarter of the Johannesburg stock market from 5 per cent five years ago — forcing many South African institutional investors to sell the stock due to concentration risk.
“As well as opening up investment to a broader category of investors, the listing aims to reduce our weighting on the Johannesburg Stock Exchange, which we believe will help us maximise shareholder value over time,” Bob van Dijk, Naspers’ chief executive, said.
“Its outsized weighting on the JSE exceeds most South African institutional investors’ single stock limits. As a result, many have been forced to sell as Naspers grows,” Mr van Dijk said.
In another attempt to reduce the Tencent discount Naspers has also completed the unbundling this month of MultiChoice, its African pay-TV business which was worth $3.5bn when listed in Johannesburg.
Naspers will continue to directly hold its South African businesses including the ecommerce group Takealot and media properties.
“We see great opportunity in South Africa. We are one of the most foremost technology investors” in the country, Mr van Dijk said.
