The Curro deal gets the green light (JSE: COH)

The parties are satisfied that all conditions have been met

In very good news for South African children, the Curro transaction has met all the deal conditions and will be going ahead. I wondered if we might experience the classic South African regulatory experience of some kind of disaster along the way (usually from the Competition Commission), but thankfully the conditions attached to the approval seem to be acceptable to the parties.

With the TRP compliance certificate due imminently, Curro will soon announce the final timetable for the delisting.

The anti-billionaire peanut gallery has had a lot to say about this deal on social media. I’ll just make my position super clear here: this is a massive get-out-of-jail card for the South African education system. Curro was on a concerning trajectory and simply didn’t make sense anymore as a listed for-profit company.

Hold onto your hats for the Hulamin numbers (JSE: HLM)

Just how bad will the full year be?

Hulamin’s normalised HEPS was down 48% at the halfway mark of the year. Without the normalisation adjustments, HEPS was down a spectacular 81%. It’s therefore not a surprise that the numbers for the year ending December 2025 are going to be sharply down vs. the prior year. The question is: by how much?

A trading statement doesn’t help us much in terms of the percentage. They’ve taken the minimum disclosure approach by indicating that earnings will fall by at least 20%. Remember, when you see the words “at least 20%” in a trading statement, the move can be a lot higher. This is why I’m referring you back to the interim move for context.

They do at least talk about “plant output having stabilised” and “product quality deviations back under control” after a period in which there was a significant integrated plant shut and associated operational challenges.

They also make it clear that they are in compliance with banking covenants and haven’t requested any covenant relaxation from lenders.

The share price is down 38% in the past year. If someone put Hulamin under your tree at the end of 2024, you’ve had a bad time since then.

Labat Africa highlights a “fundamental inflection point” – and the numbers support this (JSE: LAB)

What will this stock achieve in 2026?

Labat’s results are not particularly useful if you focus on the year-on-year percentage changes. This is because there have been significant acquisitions of IT assets, so you aren’t comparing apples with apples, or even any other kind of fruit. Instead, it’s better to just look at the current shape of the income statement and what the business currently makes.

As further evidence of just how much simpler the business is, there is no segmental report for the period. This is because the healthcare segment was disposed of with effect from 1 June 2025, leaving them with only the IT and technology operations in terms of continuing operations.

With revenue of R150.9 million and gross profit of R99.7 million, there’s clearly something to talk about here. Next up comes the strangest part: operating expenses were just R1 million. The group operating profit of R96.9 million is a seemingly impossible margin of 64%!

Cash from operations was R45 million, so there’s a pretty big gap between operating profit and the cash related to those activities. Still, that’s a healthy margin of around 30%.

With HEPS of 3.64 cents for the six months, the share price of 8 cents is looking very appealing. Punters are all over this thing. Could this be the dark horse stock pick of 2026? With the company also releasing a fresh cautionary announcement about a potential transaction, there’s a lot to consider here.

And just for fun, there’s also a very juicy paragraph in the results aimed squarely at SARS:

“The group has made every effort to bring this matter to finality. SARS on the other hand has done everything in its power to stall rectification of unlawful allocations to a debt which does not exist notwithstanding Supreme Court of Appeal case law to finalise tax matters. We have appointed a group of experts to pursue the matter on our behalf.”

I just wish they would fix their website, since I get an “account suspended” screen when I try access it!

Sanlam brings MUFG Bank onto the Shriram register (JSE: SLM)

Having the right players around the table is key to success, especially offshore

Sanlam has built an impressive emerging markets business that includes the Shriram investment in India. There are various companies in Shriram, one of which is Shriram Finance Limited – listed on the National Stock Exchange of India with a market cap of around $18 billion. Sanlam has a 9.5% stake in this company through various vehicles, but the local financial services giant plays a much bigger strategic role than the shareholding would suggest.

The latest deal will see the introduction of Japanese-headquartered financial institution MUFG Bank onto the register. MUFG has a market cap of $170 billion and a footprint across more than 50 countries. MUFG will subscribe for a 20% stake in Shriram Finance Limited for $4.4 billion, subject to regulatory and other approvals.

Aside from access to low-cost funding and the benefits of having an even stronger balance sheet, the parties have also flagged benefits in areas like technology.

Sanlam will dilute to around 7.6%. The other companies in the “promoter group” will take the total to 20.3%, just slightly more than MUFG will have. Sanlam has flagged that there might be a restructure of how its interest in Shriram Finance Limited is held.

There are other transactions underway in India as well. For example, there’s a deal going back to April 2024 in which Sanlam is looking to acquire additional interests in Shriram General Insurance Company and Shriram Life Insurance Company, taking the stakes to 50.99% and 53.69% respectively. Regulatory approvals have taken longer than expected, but they believe that the approvals should come in Q1 2026.

And in yet another deal linked to Shriram Life Insurance Company, Sanlam is looking to acquire a further 14.72% in the company from Piramal Finance. This would take the stake to 68.41% once all the deals are concluded.

India is an exciting and important emerging market in which Sanlam has built a strong position.

Nibbles:

• Director dealings:
  • A family trust in the Bekker family sold over R860 million in Naspers (JSE: NPN) shares and around R1.6 billion in Prosus (JSE: PRX) shares to fund the building of hospitality venues in South Africa, the UK and Italy. Must be nice!
  • An associate of a director of Fairvest (JSE: FTA | JSE: FTB) sold shares worth R21.4k.
  • An associate of a director of Hammerson (JSE: HMN) bought shares worth over R11.3 million. Separately, the CEO of Hammerson sold shares worth R10.5 million!
  • A non-executive director of Argent Industrial (JSE: ART) bought shares worth R1.6 million.
  • The company secretary of Famous Brands (JSE: FBR) sold shares worth R105k.
  • The CEO of Sirius Real Estate (JSE: SRE) bought shares worth R64k in a self invested pension plan.

• Frustratingly for Pan African Resources (JSE: PAN), the court was unhappy with the notice given to shareholders of the meeting for the resolutions for the share capital reduction. Despite certain shareholders not really wanting that notice and voting on the deal anyway, the court took the hard stance and has blocked the share capital reduction. Not only does this waste time, but also money – Pan African Resources will have to send out another circular and host another general meeting.

• While Novus (JSE: NVS) is still trying to bring the acquisition of Mustek (JSE: MST) to a close, the former is still buying shares in the latter on the market. The latest purchase is worth R39k, taking Novus to a 39.96% stake in Mustek and a 60.25% stake if you include concert parties. It’s a tiny purchase, but a useful reminder of how big the total stake has become.

• In a slightly funny announcement, SAB Zenzele Kabili (JSE: SZK) announced that a dividend has been received from AB InBev (JSE: ANH) for the first time – but that “the amount is not very large”. In other words, there is no dividend to SAB Zenzele Kabili shareholders.