Close

Not a member yet? Register now and get started.

lock and key

Sign in to your account.

Account Login

Forgot your password?

INVESTMENT BRIEFS: ALL SEWN UP

01 Jul General

All sewn up

Whatever is the investment arm of the SA Clothing & Textile Workers Union (Sactwu) up to?

Sactwu is the biggest shareholder in Hosken Consolidated Investments but has lately shown a distinct lack of appetite for certain of the subsidiaries and offshoots of the empowerment investment giant.

In 2014 Sactwu sold out of HCI’s unbundled alternative energy operation Montauk, and then earlier this year seemed happy to let HCI prime mover (and former trade union stalwart) Johnny Copelyn walk away with the company’s Australian subsidiary Oceania Capital.

In the latest deal Sactwu lets go of 133,5m shares in value-laden industrial and property group Deneb. This represents about 24% of Deneb’s share capital.

Deneb will repurchase Sactwu’s shares at 200c/share, allowing the union to pocket a princely R267m. At face value it appears Sactwu is scoring handsomely since the buy-back price was pitched at a more than a 20% premium to the ruling share price.

For Deneb — which is gradually ratcheting up yields from a valuable property portfolio — the share buy-back is a great long-term option. The repurchase is clinched at an attractive 42% discount to the last stated tangible net asset value of 347c/share — greatly enhancing earnings for shareholders.

What Sactwu intends doing with cash proceeds of R237m is far more intriguing. Possibly it will mobilise some of the proceeds to shore up operations at its clothing manufacturing operations, which were acquired from Deneb (then Seardel) several years ago. Or does Sactwu intend reinforcing its stake in HCI now the key asset, gaming group Tsogo Sun, is seemingly set to spin higher profits?

Low rollers

Has alternative gaming group Niveus Investments, which plies its trade mainly in the limited payout machine and electronic bingo terminal domains, bet wisely by investing in a small casino in Kuruman?

Source: BDLIve – Marc Hasenfuss

Niveus’ latest financial results don’t give much detail, but directors did note that the performance of the relatively new Kuruman casino was poor due to the decline in mining activity in the region and (unspecified) operational issues.

Niveus directors said though the casino generated positive cash flows, it was not generating a return on the investment.

Now we know why the mainstay casino operators avoided the Kuruman licence.