THE inclusion of e.tv’s holding company, Sabido, in Seardel Investment Corporation would provide institutional investors with more direct access to the performance of the media group, Seardel CEO Stuart Queen said on Monday.
Mr Queen was interviewed following the announcement of a shareholder restructuring, in which Hosken Consolidated Investments (HCI) would sell its stake in Sabido to Seardel.
The companies said on Monday that a headline on the JSE’s Sens news service on Friday that purportedly cancelled the sale of the stake, was incorrect, and instead the deal would create an empowered media platform and provide Seardel shareholders with exposure to a cash-generative media asset.
Mr Queen said the transaction would give Seardel an interest in an investment in a “growing industry”, as some of the group’s businesses were in relatively mature industries.
He described Sabido as a profitable media business that had been growing for a number of years.
Seardel’s share price was traded at 170c per share on Monday, after shooting up 36% to 170c on Friday after the deal was announced.
HCI’s share price fell slightly on Monday but only after rising 5.6% to a new 12-month high on Friday.
Mr Queen said although it was hard to ascribe reasons for share price movements, the fact that the prices were up seemed to indicate shareholders were happy with the transaction.
Seardel, which is more than 75% controlled by HCI, has interests in properties, branded consumer products, textiles, industrial products and clothing operations.
Aside from e.tv, Sabido also operates a pan-African entertainment channel, e.tv Africa, which broadcasts in 49 countries on the continent, and it has direct investments in broadcasting businesses in Botswana and Ghana.
The Southern African Clothing and Textile Workers’ Union (Sactwu), which holds 40.2% of HCI, would through a series of transactions also gain a more direct interest in Sabido.
A key aim of the transactions was to create an “empowered media platform”.
In addition, as a subsidiary of a separately listed investment holding company, Sabido would have greater access to debt and equity capital markets to fund future growth opportunities.
The transactions would leave HCI with an 81.2% voting and an 84.4% economic interest in Seardel.
“Sabido continues to expand its media business with investments in content production and distribution as well as the launch of services across multiple platforms and territories,” a statement said.
The companies said the financial effects of the transactions were expected to be released in due course.
Source: BDLive – Edward West