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NAFHOLD BOARD SHOOTS DOWN HCI’S REVISED R900m OFFER

The Nafhold board has rejected the revised offer of R900 million from Hosken Consolidated Investments (HCI) for the 25 percent stake Nafhold holds in Tsogo Investment Holdings (TIH). Nafhold’s chief executive, Michael Leaf, said the decision of the meeting this week was unanimous. He disclosed that Nafhold had received other offers, which were higher than HCI`s. Three of these were official. Leaf said the HCI offer was rejected upon its evaluation and the other offers had not played any role in the board reaching its decision. Johnny Copelyn, HCI’s chief executive, said: “Presumably, they will notify us of their decision … we will then consider what we do next.” Nafhold is the investment arm of the National African Federated Chamber of Commerce and Industry. HCI first made an offer of R750 million last year for the entire issued share capital of Nafhold, which was rejected as inadequate. Last month, HCI raised its offer by 20 percent to R900 million, specifically for the Nafhold stake in TIH. HCI said it would allow Nafhold to sell its other investments. TIH is a 51 percent owner of Tsogo Sun, which runs casinos and Southern Sun hotels. HCI and Nafhold have been at each other’s throats over TIH where HCI has been fighting to have an extra 25 percent. HCI has a 51 percent stake in TIH. HCI bought a 19 percent stake in TIH from the Foundation for African Business and Consumer Services (Fabcos). However, this transaction is subject to approval by the provinces in which Tsogo operates casinos. KwaZulu-Natal and the Eastern Cape gaming boards have approved it but the Mpumalanga gaming board turned HCI down last month. One of the reasons for the refusal was that HCI manipulated its empowerment credentials and misrepresented pertinent information regarding the implementation of its transaction with Fabcos. HCI said it intended to appeal the decision.

Source: Sunday Independent – Business Report – Wiseman Khuzwayo