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Ghost Bites (Orion Minerals | Prosus | Vodacom – Remgro)

The Finance Ghost
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Ghost Bites (Orion Minerals | Prosus | Vodacom – Remgro)

Orion Minerals raises at least R37 million in cash as part of a larger equity raise (JSE: ORN)

If the share purchase plan goes well, it could be a lot higher

Orion Minerals has announced the issue of 522 million shares at R0.13 per share (roughly the current traded price), thereby raising around R67 million in equity.

They’ve managed this by achieving commitments from sophisticated and professional investors in the market who signed up for R37 million, with this amount flowing into the group as a cash raise. To further improve the balance sheet, entities related to current and prior management have agreed to convert R30 million in loans into shares.

As the icing on the cake, Orion will offer a share purchase plan to shareholders, giving them the opportunity to subscribe for up to R355k in shares per shareholder, with a potential raise of up to R46 million. I appreciate the commitment that Orion has shown to retail investors here, as most companies just raise from institutions in fancy boardroom deals and leave the average shareholder out in the cold, aside from rare examples where rights issues are necessary. This combination of an institutional raise and a share purchase plan is exactly what companies should always do.

Please note that the share purchase plan is only available to shareholders who were already on the register as at 7 July.

Orion will use the proceeds to fund the development at Prieska Copper Zinc Mine and Okiep Copper Project, as well as the usual catch-all of “general working capital purposes” at the group.

Prosus is having no trouble in attracting capital (JSE: PRX)

This is what happens when a group stops eating cash

The major highlight of the recent financial performance at Prosus is that they are no longer free cash flow negative in their operations excluding Tencent. If you know the history of the group, you’ll know that this is a big deal.

This does wonders for the balance sheet. Although Prosus has plenty of long-dated debt that doesn’t need to be refinanced yet, having strong ongoing support from the debt market is important for a group of this size.

Prosus has priced €750 million in notes due 2035. This will refinance the notes that matured in 2025, as well as €500 million worth of notes maturing in January 2026. The bonds were priced at 4.343% and were more than four times oversubscribed by investors, so there’s no shortage of interest from investors wanting to earn interest from Prosus.

Prosus is rated BBB with a stable outlook by S&P and Baa2 with a stable outlook by Moody’s. This means that the bonds are investment grade with a moderate level of risk. As Prosus keeps derisking its business, its credit rating should hopefully improve and the cost of borrowing will come down. I think we are some way off that, but the direction of travel is clear.

Finally, the Dark Fibre deal can step into the light for Vodacom and Remgro (JSE: VOD | JSE: REM)

The negotiations with the Competition Commission have paid off

After many, many, many extensions to the long-stop date for the transaction that would see Vodacom and Remgro combine their fibre assets into an exciting new venture, there’s finally success.

The Competition Commission initially blocked the deal in a move that received no shortage of valid criticism. Since then, the parties have been trying to agree a set of transaction conditions that would please the Commission. I look forward to those conditions coming to light, as I have my suspicions that the term “public interest” is working very hard once more to mean Black Ownership under B-BBEE rules rather than stuff like access to internet in low income areas. Perhaps I’ll be pleasantly surprised, but I doubt it. For whatever reason, the Competition Commission sees itself as the B-BBEE implementation arm of government.

With this deal now going to the Competition Appeals Court on an unopposed basis, Vodacom and Remgro will soon have the fibre assets of CIVH (including Vumatel and Dark Fibre) and of Vodacom in the same entity, namely Maziv. Vodacom will have a 30% stake in that entity.

There isn’t much growth in traditional cellphone services in South Africa, so this fibre deal is very important for Vodacom in particular.

Nibbles:

  • Director dealings:
    • In addition to a reshuffling of the structure through which he holds his shares, a director of a major subsidiary of PBT Group (JSE: PBG) bought additional shares worth R36k.
  • Datatec (JSE: DTC) is busy with a scrip dividend alternative to the cash dividend of 200 cents per share. If shareholders want, they can elect to receive 3.21027 shares for each Datatec share held. This is calculated based on the 30-day VWAP, less the dividend.
  • Castleview (JSE: CVW) is also busy with a dividend reinvestment alternative, but they’ve decided to price it at R9.53540, which is the net asset value (NAV) per share. The stock never trades as it is so tightly held, but the last available price was R8.20. As it’s impossible to buy more shares on the market, any investors looking to increase their stake will need to pay the NAV per share.

Ghost Bites (Assura – Primary Health Properties | South32)

The Finance Ghost
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Ghost Bites (Assura – Primary Health Properties | South32)

Assura shareholders aren’t exactly rushing to accept the Primary Health Properties offer (JSE: AHR | JSE: PHP)

Perhaps I was right about the cash offer being far more attractive?

The Assura – Primary Health Properties deal is far from done. I wasn’t surprised at all to see strong support from the Primary Health shareholders, as it’s a good deal for them. As for Assura shareholders, they seem to be a lot more cautious in signing up for a merger. Again, I don’t blame them. I genuinely think that the Assura board backed the wrong deal here, as cash alternatives are just so much cleaner – even if the price is slightly lower.

There’s a long way to go still, with the offer open until 12 August. As things stand, valid acceptances for just 1.14% of Assura shares have been received by Primary Health. Perhaps there will be a surge in acceptances. And perhaps there won’t…

To help with trying to convince Assura shareholders to say yes, Primary Health released a trading and financial update for the six months to June 2025. The update takes the opportunity to remind Assura shareholders that the deal would create a UK REIT with a combined portfolio of roughly £6 billion of assets, with the tenants generally being in the public sector in the UK. The public sector vs. private sector debate has been a feature of this deal, with the plan being for the merged entity to have 80% to 90% government-backed income, while the private sector assets are sold off into a joint venture.

As for the numbers, the six months to June 2025 saw a 3.1% increase in net rental income and a 2.9% increase in the dividend per share. When you’re dealing with a risk profile like government tenants in the UK, you’re looking for dependability of income rather than growth. This also allows them to run at quite a spicy loan-to-value ratio, currently at 48.6%.

I’m really looking forward to seeing how the latter stages of the offer period play out. It’s been a fascinating deal to follow.

South32 offloads their nickel asset in Colombia (JSE: S32)

And they are happy to just get paid something in the future

The nickel market hasn’t been a happy place. This is a classic situation of oversupply, with too much investment in this metal in anticipation of electric vehicle demand that hasn’t materialised. This results in depressed nickel prices and a reduction in supply until equilibrium is reached.

South32 isn’t hanging around for that, with a decision to sell Cerro Matoso in Colombia to CoreX Holding. The upfront price is nominal, with South32 just happy to be rid of the current and future liabilities. There is an “agterskot” though (as we like to call it in South Africa), in the form of potential future payments of up to $100 million.

Up to $80 million relates to price-linked consideration based on future production and nickel prices, while up to $20 million is based on permitting milestones within the next five years for the Queresas & Porvenir North project.

Sometimes, you just need to walk away and cut your losses. South32 will have to recognise an impairment expense of $130 million as this asset is shifted off the balance sheet.

Nibbles:

  • Director dealings:
    • Sean Riskowitz has bought shares in Finbond (JSE: FGL) worth R433k.
  • MTN Zakhele Futhi (JSE: MTNZF) is in the process of being wound up and returning value to shareholders, all thanks to the recent strength in the MTN share price that gave them this opportunity. The latest step is the declaration of a special distribution by way of return of contributed tax capital of R20.00 per share.
  • Glencore (JSE: GLN) is commencing a share buyback programme of up to $1 billion, with a plan to complete this programme by February 2026. UBS in London has been appointed to manage the process. For context, much as that sounds very large and impressive, Glencore’s market cap is R955 billion. This programme is therefore roughly 2% of issued share capital.
  • Old Mutual (JSE: OMU) announced the appointment of Prabashni Moodley as the CEO of the new Life and Savings segment. Under this segment, you’ll find Personal Finance, Old Mutual Wealth Management, Old Mutual Corporate and the Mass and Foundation Cluster. Moodley has been with Old Mutual since 2002 and is currently the Management Director of Old Mutual Corporate. Will this new structure help Old Mutual close the gap to a peer like Sanlam? Over five years, Old Mutual is down 4% and Sanlam is up 43%!
  • Accelerate Property Fund (JSE: APF) has been granted an extension by the JSE for the issuing of the circular for the sale of Portside. The extension gives them until 31 July.
  • Trustco (JSE: TTO) still hasn’t released financials for the year ended August 2024. They are currently waiting for a ruling from the JSE, so there’s no indication of when they will finally be released.

UNLOCK THE STOCK: Attacq

The Finance Ghost
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UNLOCK THE STOCK: Attacq

Unlock the Stock is a platform designed to let retail investors experience life as a sell-side analyst. Corporate management teams give a presentation and then we open the floor to an interactive Q&A session, facilitated by the hosts.

We are grateful to the South African team from Lumi Global, who look after the webinar technology for us, as well as EasyEquities who have partnered with us to take these insights to a wider base of shareholders.

In the 57th edition of Unlock the Stock, Attacq returned to the platform to update us on the recent numbers and the latest strategic thinking. I co-hosted this event with Mark Tobin of Coffee Microcaps and the team from Keyter Rech Investor Solutions.

Watch the recording here:

What 25 years as a market pioneer taught us about South African investing

Kingsley Williams, CIO at Satrix
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What 25 years as a market pioneer taught us about South African investing

A quarter-century ago, Satrix launched South Africa’s first exchange traded fund (ETF). We were inspired by a radical idea: make investing accessible, affordable and effective for everyone.

At the time, ETFs were still gaining ground globally. In South Africa, they were unheard of. But with support from the JSE and seed capital from Sanlam, we took the leap. Today, index investing is mainstream, but the journey to get here came with big lessons.

Here are five lessons that we think matter more than ever:

1. Indexation isn’t just ‘average’ – it often outperforms

When Satrix launched, the notion that you could track an index and still win seemed counterintuitive. But over time, the data tells a compelling story: net of fees, low-cost indexed strategies have consistently delivered above-average results, especially over long periods. For example, the Satrix All Share Index Fund A1 ranks third out of 24 unit trusts in the ASISA South African Equity General category that have maintained a 10-year track record to the end of April 2025, delivering an impressive, annualised return of 8.1%1. Furthermore, the Satrix 40 ETF, which was the genesis of the Satrix story, has delivered an even better performance at 9.0% p.a. over the last 10 years2.

Despite a slow start, South Africans are now moving in this direction. In 2024, index funds across all ASISA categories attracted over 87% of net new flows3. The shift to rules-based investing is accelerating, not because it’s fashionable, but because the outcomes are better.

“We didn’t follow trends. We followed conviction. And now the market is catching up.”

2. Innovation only matters if it solves real problems

Being first doesn’t guarantee success. What matters is solving for what investors actually need.

That’s why we built local intellectual property, creating indices tailored to South Africa’s unique market structure – from high sector concentration to liquidity constraints. It’s also why we expanded beyond building blocks to full portfolio solutions, from our SmartCoreTM range to balanced funds.

Our early move into balanced funds brought an index-based approach to a space traditionally dominated by active management. Instead of trying to add value by tactically timing asset class exposures, we stuck to a well-considered strategic asset allocation based on thorough research and long-term conviction. Since its inception, the Satrix Balanced Index Fund A1 has been in the top quartile more than 70% of the time and outperformed the median more than 95% of the time on a rolling five-year basis, delivering one of the most consistent performance track records in the ASISA South African MA High Equity category4.

“We brought index thinking into multi-asset portfolios, giving investors more than just parts – we gave them outcomes.”

3. Scale can drive real financial inclusion

As our funds grew, so did our ability to cut costs. We passed those savings on. When the Satrix MSCI World Index Fund scaled, we converted it into a direct fund – reducing fees for everyone. The Satrix Nasdaq 100 ETF followed a similar path.

We call it the double dividend: scale lowers costs, which boosts net-of-fee returns.

“It’s not just about performance – it’s about performance that more people can afford to access.”

4. Bridging gaps makes markets more inclusive

For years, ETFs were the preserve of direct investors, wealth managers and investment professionals, while financial advisers leaned on unit trusts. That left a gap. By pushing ETF availability onto Linked Investment Service Provider (LISP) platforms, we opened up a new channel – one where advisers and their clients could access the benefits of indexing without changing platforms.

“We helped bridge the divide – and in doing so, widened the path to inclusion.”

5. Basics matter

Younger investors – Gen Z and Gen Alpha – are looking for cost effective and flexible investments without compromising returns. They want to be able to start small and not be penalised. That’s especially true in a country like South Africa, where affordability and unemployment are real challenges. That’s why convenient access, no minimums, a wide range of investment choice and compelling long-term returns remain our focus.

Looking ahead: the next chapter of access

Indexation is still gaining ground globally – and South Africa is no different. With 25 years of performance data now behind us, the case is stronger than ever.

As we move forward, we will keep expanding the options for people to access investments. This includes digital platforms, new investment strategies, and addressing use cases that we have not yet tackled. By leveraging fintech and promoting ongoing innovation, we aim to further reduce barriers that might discourage first-time investors.

Globally, we’re seeing indexation and investment innovation continue to grow, especially in the US, and increasingly in Europe. South Africa is on the same path. Now that local investors have 25 years of performance history, investors are increasingly seeing the same proof in the pudding.

Critics sometimes argue that index funds “guarantee underperformance” because they don’t offer any outperformance of the index after fees. But that’s the wrong question, as you can’t invest in an index itself. The right question is: how do funds tracking an index perform relative to any other fund available on the market? And over 10+ years, the data is clear – low-cost indexed strategies regularly outperform a significant majority of actively managed peers. That’s what matters.

This article was first published here

Sources:

1 Morningstar, as at 30 April 2025

2 Morningstar, as at 30 April 2025

3 Morningstar & Satrix, as at 31 December 2024

4 Morningstar & Satrix, as at 30 April 2025

Disclaimer:

*Satrix is a division of Sanlam Investment Management

Satrix Managers (RF) (Pty) Ltd is an approved financial service provider in terms of the Financial Advisory and Intermediary Services Act, No 37 of 2002 (“FAIS”). The information above does not constitute financial advice in terms of FAIS. Consult your financial adviser before making an investment decision. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSP, its shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information.

Satrix Managers (RF) (Pty) Ltd (Satrix) is a registered and approved Manager in Collective Investment Schemes in Securities. Collective investment schemes are generally medium- to long-term investments. With Unit Trusts and ETFs, the investor essentially owns a “proportionate share” (in proportion to the participatory interest held in the fund) of the underlying investments held by the fund. With Unit Trusts, the investor holds participatory units issued by the fund while in the case of an ETF, the participatory interest, while issued by the fund, comprises a listed security traded on the stock exchange. ETFs are index-tracking funds, registered as a Collective Investment and can be traded by any stockbroker on the stock exchange or via Investment Plans and online trading platforms. ETFs may incur additional costs due to being listed on the JSE. Past performance is not necessarily a guide to future performance and the value of investments / units may go up or down. A schedule of fees and charges, and maximum commissions are available on the Minimum Disclosure Document or upon request from the Manager. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. Should the respective portfolio engage in scrip lending, the utility percentage and related counterparties can be viewed on the ETF Minimum Disclosure Document.  A fund of funds portfolio is a portfolio that invests in portfolios of collective investment schemes that levy their own charges, which could result in a higher fee structure for the fund of funds. International investments or investments in foreign securities could be accompanied by additional risks such as potential constraints on liquidity and repatriation of funds, macroeconomic risk, political risk, foreign exchange risk, tax risk, settlement risk as well as potential limitations on the availability of market information.

For more information, visit https://satrix.co.za/products

Ghost Bites (HCI | MAS)

The Finance Ghost
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Ghost Bites (HCI | MAS)

HCI wants to sell Gallagher Estate and other properties to SACTWU, but it’s far from a vanilla deal (JSE: HCI)

Selling the properties is good in theory, but these terms are quite something

When I last wrote about HCI and its group companies in Ghost Bites, I pointed out a fundamental problem: the group’s most important cash cow is its gaming assets, and with the shift to online betting, casinos are producing less milk. To add to the pressure, HCI is investing in speculative plays like energy, which tend to be capital intensive with uncertain outcomes. This isn’t a great combination.

An obvious way to improve the balance sheet would be to sell off certain properties in the group that are sucking up capital and producing poor returns. For some reason, even in HCI subsidiary companies, there’s a love of holding unnecessary property assets. So, in theory, seeing a sale of assets like Gallagher Estate is positive. The bad news is that this disposal does absolutely nothing to improve HCI’s cash flow. In fact, it leads to a cash outflow.

How can that be? My read of it is that HCI has decided to solve the problems of the Southern African Clothing and Textile Workers’ Union (SACTWU) at the expense of other shareholders. Now, HCI’s history is firmly entrenched in the unions, so this shouldn’t come as a huge shock.

SACTWU currently holds 23.8% of HCI’s shares in issue. They aren’t managing to meet their financial obligations, so they keep selling HCI shares in the market, a situation that isn’t sustainable. There’s an argument to be made that this is an overhang on the HCI share price. I think it’s a weak rationale for a deal though, especially on these terms. Average daily value traded in HCI shares is below R10 million, so it would be difficult, but not impossible, for SACTWU to unlock that kind of value through on-market disposals.

Here’s part one of the deal: HCI (acting through an unlisted subsidiary called Squirewood Investments) will repurchase 1.1 million shares from SACTWU for R144.1 million at a price of R131 per HCI share. At the start of trade on the day of the announcement, the market price was R130.50 per share, so this is approximately the market price.

Yes, HCI with its balance sheet under pressure and with dicey core exposures will be parting with R144.1 million to buy its shares back at the market price, giving SACTWU a sweetheart deal of note to exit part of their position. Hmmm.

But what about the property disposals? Do those make up for it?

HCI will sell its shares and claims in Gallagher Estate, HCI Rand Daily Mail and HCI Solly Sachs House for SACTWU for R550 million. There will then be an agreement for Squirewood to purchase shares worth the same amount from SACTWU (once again at R131 per share). A cession agreement will essentially offset these amounts.

In other words, the R550 million doesn’t actually flow. HCI is repurchasing a ton of shares here and is offloading the properties. When all is said and done, SACTWU will hold 18.4% in HCI rather than the current 23.8%. Whether or not HCI would then look to dispose of the shares in the market or hold them as treasury shares is unclear.

Does this actually solve anything for SACTWU on a sustainable basis? The total value of the net assets is R510 million on the HCI balance sheet. As one of them is loss-making, they achieve net attributable income of just R5.5 million, which is an astonishingly bad return. It’s difficult to imagine that this makes such a difference to SACTWU.

Did you notice the price? It looks like SACTWU is paying a premium to the current net asset value on the properties, although this could just be because of an outdated valuation. Based on attributable net income though, the properties are either terribly mismanaged or just terrible, full stop.

Shareholders will have to approve this, with a special resolution required. SACTWU isn’t allowed to vote on the deal. I don’t personally like this deal and can’t see why HCI shareholders would rush to approve it, unless HCI has managed to sell the properties at an inflated price, with the balancing point being that HCI then needs to drip shares into the market to raise cash instead of SACTWU having to do that.

If shareholders believe that HCI’s shares are currently undervalued, then they will see this as a clever transaction that gives HCI flexibility down the line. Those with a more bearish take will be worried about the cash outflow at a time of weakness in the gaming industry, potentially creating further pressure for HCI down the line.

I can’t wait to read the independent expert report!

MAS makes the summary of the all-important joint venture agreement with PK available (JSE: MAS)

The “summary” is 17 pages long – and it delivers an important lesson

Webber Wentzel was appointed by MAS to summarise the joint venture agreement that is at the centre of a negotiation between MAS and Prime Kapital (PK). This is because the terms have come as a surprise to investors in terms of the difficulty that MAS is having in getting access to the cash in the joint venture. The summary is 17 pages long and is available here.

The joint venture was set up for development of property in Central and Eastern Europe, with PK appointed as the general partner of the joint venture. Importantly, there are reserved matters that require unanimous approval of the B ordinary shareholders (i.e. MAS and PK). When you see unanimous approval, be afraid. Be very afraid.

After all, joint control is just a different way of saying no control.

Ironically, MAS is actually better off for the unanimous approval requirement, as they only own 40% of the B ordinary shares despite having put in all the capital for the A preference shares. In other words, MAS signed up to put in far more capital than PK in the form of non-voting shares, while having very little in the way of ability to drive the direction of the joint venture due to a non-controlling stake in voting shares. From PK’s perspective, they have a controlling share of the voting shares, but this doesn’t amount to much due to the agreement.

My view on commercial agreements is that the risk capital should drive control. MAS should’ve had a controlling stake in the ordinary shares and there should’ve been some basic protections in place for PK, rather than the ability to veto dividends.

Let this be a lesson to anyone negotiating a deal where there’s an imbalance. I’ll reference that old wisdom: they who have the gold, make the rules. If you have the gold and you give someone else the power to stop you getting it, then you’re going to have a bad time.

Nibbles:

  • Director dealings:
    • A number of Dis-Chem (JSE: DCP) directors, including members of the founding family, sold shares worth R11.8 million in relation to various share awards. There’s one small sale that is referenced as being the taxable portion, so I assume that the rest is not just the taxable amount.
    • Sean Riskowitz bought shares in Finbond (JSE: FGL) worth R570k.
    • A director of a subsidiary of PBT Group (JSE: PBG) bought shares worth R36k.
  • As a reminder of how different the listing rules are in Australia vs. the JSE, Orion Minerals (JSE: ORN) has a halt in place on the Australian Stock Exchange (ASX) ahead of capital raising activities, but there’s no such halt in place on the JSE. The halt on the ASX will be lifted when Orion announces the results of the capital raise.
  • Vodacom (JSE: VOD) and Remgro (JSE: REM) have agreed to extend the longstop date for the fibre transaction to 18 July. With the Competition Appeal Court heading dates reserved for 22 to 24 July, that date will need to be extended again for the deal to stay alive. As we recently saw in the Sun International (JSE: SUI) – Peermont transaction, it’s not a foregone conclusion that parties will extend the date.
  • Burstone (JSE: BTN) announced that Jenna Sprenger will step down as CFO at the end of August 2025, after 12 years with the company. Myles Kritzinger, ex-CEO and CFO at Transcend Residential Property Fund, will take the CFO role at Burstone with effect from 1 September 2025.
  • After getting rid of their designated advisor, Mantengu Mining (JSE: MTU) has now appointed AcaciaCap Advisors to that role. In case anyone is keeping score, the share price is down 24% year-to-date and we still haven’t seen any concrete evidence of illegal behaviour in the market.
  • If you’re keeping an eye on the few remaining preference shares listed on the JSE, then be aware that Absa (JSE: ABG) is about to repurchase and delist its preference shares this month.

Dumb luck: the Timothy Dexter story

Dominique Olivier
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Dumb luck: the Timothy Dexter story

In a world obsessed with optimisation and five-year forecasts, there’s something deeply satisfying about success that arrives by mistake. Especially the kind that should have ended in disaster, but somehow didn’t.

Take Aspartame, for example. That sweet little zero-calorie miracle was never meant to flavour your diet soda. It started out as an experimental anti-ulcer drug. A student working in the lab at the time misunderstood an instruction to “test” the compound, and for reasons best left unexplored, decided to lick it off his finger. Instead of dropping dead, our hapless hero discovered that the substance was remarkably sweet. And just like that, Aspartame was born – not with precision or peer review, but with a lucky lapse in judgement.

History is full of these kinds of people; the ones who bumble their way into brilliance. But few ever did it with the level of confusion, confidence, and outright chaos as Timothy Dexter, a semi-literate, self-proclaimed philosopher who built a fortune by ignoring common sense and making every wrong move feel like a masterstroke.

Usually in this column, I try to tell stories that carry some kind of useful insight – a moral, a principle, perhaps even a profound takeaway about the nature of success or human behaviour.

This isn’t one of those stories.

What follows contains no useful advice whatsoever. I don’t recommend emulating a single thing you’re about to read. But I do suggest reading it out loud at your next family dinner. Because if ever there was a true tale that reads like fiction, it’s the saga of Timothy Dexter.

A quick note on facts and claims

In addition to his accidental business brilliance, Timothy Dexter also fancied himself a writer. This, as it turns out, is both a blessing and a bit of a problem.

On the upside, we have a firsthand account of his bizarre life, which is rare for an 18th-century eccentric. On the downside, his writing was a chaotic mess: no punctuation, erratic spelling, and endless self-praise. Historians still hotly debate whether he was joking, delusional, or both.

Author John P. Marquand tried to make sense of it all in Timothy Dexter Revisited, one of the few serious attempts to separate fact from fiction. Still, even with Marquand’s help, we’re left with a picture of a man who may have invented himself as much as he invented his fortune. What follows is therefore the story as far as we know and believe to be reasonably true. 

A frothy investment

Timothy Dexter wasn’t exactly what you’d call formally educated; in fact, his schooling ended almost before it began. By eight, he was labouring on a farm and by fourteen, he was knee-deep in hides and animal fat as a tanner’s apprentice. It was, by all accounts, an unglamorous start. But Dexter had two things going for him: blind optimism and an unshakable belief that he was destined for greatness. That, and a very fortunate marriage. In his early twenties, he wed a wealthy widow named Elizabeth Frothingham and used her fortune to set up a leather goods shop in Newburyport, Massachusetts.

Dexter did well enough from his shop to start entertaining bigger, stranger ideas. He began speculating, a word that in his case meant throwing money at wildly impractical ventures with the swagger of a man who definitely hadn’t done the maths.

One of his earliest gambles was buying up mountains of Continental currency. This was the paper money printed by the Continental Congress during the American Revolution. It had been so overproduced that, by the end of the war, it was practically worthless. Most people wouldn’t have accepted it as wallpaper. But Dexter, convinced he saw something others didn’t (a recurring theme), bought it by the cartload for pennies. Literally – pennies on the dollar.

Despite the fact that there were no indications that this might happen, Dexter reasoned that the government might one day change its mind and make the money redeemable again. And then in the 1790s, that exact thing happened. The newly minted US Constitution included a provision that allowed holders of Continental currency to trade it in for government bonds. And just like that, the man who had hoarded worthless paper like a magpie with a head injury became outrageously, accidentally rich.

Dexter’s critics (and there were many) called it dumb luck. And they weren’t wrong. But Dexter, ever the opportunist, took it as divine confirmation that he was a financial genius. Which was just the confidence boost he needed to start speculating on a much more daring scale.

First America, then the world

Flush with cash and positively dripping with confidence, Timothy Dexter did what any newly rich eccentric with delusions of genius might do: he built himself a small fleet of ships and launched an export business. This, despite the small logistical hiccup of being functionally illiterate and knowing next to nothing about international trade.

Instinct can only take you so far, especially when you’re surrounded by people actively trying to ruin you. You see, Dexter’s circle of “advisors” were less mentors and more saboteurs. Many were upper-crust merchants who resented his sudden, unearned rise and thought it would be hilarious to feed him terrible business ideas and watch him self-destruct. What they failed to account for, tragically, was Dexter’s supernatural ability to fail upwards.

Let’s take the time they told him to ship coal to Newcastle, a city famous for its massive coal reserves. Dexter sent a ship anyway, arrived during a miners’ strike, and sold out at a profit. Then came the bedwarming pans to the West Indies, where no one needed to heat their beds – so he rebranded them as molasses ladles and sold them to sugar plantations. Gloves to the South Sea Islands? Scooped up by Portuguese traders en route to China. Bibles to the East Indies? Bought by missionaries. Stray cats to the Caribbean? Solved a rat problem in a cinch.

Even his mistakes were profitable. He once hoarded whalebones, thinking they might be valuable for reasons unknown. Turns out, whalebone was soon in high demand for its use in corset stays. Women across America were cinching their waists with the remnants of Dexter’s latest blunder.

The inevitable autobiography

In 1802, Timothy Dexter decided the world needed his thoughts in print. The result was a self-published gem titled A Pickle for the Knowing Ones; or, Plain Truths in a Homespun Dress – a book that was part autobiography, part rant, and entirely unhinged. Inside, Dexter boasted shamelessly about his successes, aired grievances against his wife and various enemies, and did so with zero punctuation, chaotic spelling, and the kind of random capitalisation that suggests he was fighting the alphabet in hand-to-hand combat.

One baffled critic later described it as “a jumble of letters promiscuously gathered together,” which feels generous. Dexter gave the first edition away for free in Salem, Massachusetts, where it quickly caught on. The public, ever fond of a trainwreck, kept asking for more. The book was reprinted eight times, making it an accidental bestseller.

By the second edition, Dexter responded to critics’ demands for punctuation by adding an entire page filled with stray punctuation marks (just lines of dots, commas, question marks and the like) with instructions that readers could “peper and solt it as they plese.” Truly, a man ahead of his time in crowdsourced editing.

When Dexter died in 1806, his estate was valued at $35,027, which translates to roughly $922,957 in today’s money assuming you just increase it by inflation. While that’s not exactly a fortune (going by the state of his mansion and its grounds, Dexter was the kind of man who believed in spending his money), it’s still not bad for someone who wrote like a cat walking across a keyboard.

Was Timothy Dexter a madman, or a master of accidental strategy, or some type of unconventional business savant?

He referred to himself as “the greatest philosopher in the known world.” Historians tend to disagree. But what can’t be denied is this: Dexter made a good living by leaning into the absurd, the impossible, and the unadvisable – and somehow, it just kept working.

He wasn’t educated, but he understood the art of the pivot. He wasn’t a writer, but he sold books. He wasn’t respected, but he was remembered.

How many of his peers could claim the same?

About the author: Dominique Olivier

Dominique Olivier is the founder of human.writer, where she uses her love of storytelling and ideation to help brands solve problems.

She is a weekly columnist in Ghost Mail and collaborates with The Finance Ghost on Ghost Mail Weekender, a Sunday publication designed to help you be more interesting. She now also writes a regular column for Daily Maverick.

Dominique can be reached on LinkedIn here.

Ghost Bites (Alphamin | Capitec | Hudaco | Reinet)

The Finance Ghost
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Ghost Bites (Alphamin | Capitec | Hudaco | Reinet)

A solid quarter at Alphamin after their operational restart (JSE: APH)

The numbers look much better

After a rough time in Q1 2025 that saw a sequential drop of 31% in ore processed (i.e. vs. Q4 2024), Alphamin needed a strong recovery. Security concerns in mid-March had ruined that quarter due to an operational stop on 13 March 2025. Operations were only resumed on 15 April 2025. As you can imagine, this resulted in a decrease in production guidance for the year and a nasty outcome for the share price:

As you can also see, the share price has clawed back much of the losses. The production results for the second quarter should give further momentum to the recovery, as tin sales increased by 19% in Q2 vs. Q1. With steady tin prices and only a slight uptick in all-in sustaining costs, this means that EBITDA was up 21% sequentially. This is despite a 4% decrease in production.

With results like these, the balance sheet is looking much healthier. They’ve swung from a net debt position of $2 million to a net cash position of $50 million – that’s much more like it.

They can’t get back the lost time of course, but they are certainly doing their best.

Capitec’s credit rating has a positive outlook, but there’s a broader story here (JSE: CPI)

S&P had some good things to say about SA as a whole, to the benefit of all banks

Credit ratings don’t tell you much about equity returns, as credit rating agencies are focused only on downside risk, whereas equity investors need to consider the upside potential in the context of the down risk. The useful thing for equity investors is that a better credit rating means a lower cost of borrowing, which in turn puts more of the economics of the business in the hands of equity holders.

Capitec’s credit rating has been affirmed by S&P with a positive outlook. That’s not a surprise. The bigger surprise is the commentary from S&P about South Africa, which I’m going to repeat verbatim from the Capitec announcement because it’s so interesting:

“S&P Global Ratings (‘S&P’) revised their Banking Industry Country Risk Assessment (BICRA) anchor for South African banks upwards from ‘bb+’ to ‘bbb-‘based on their view that the South African banking system has transitioned into an expansionary phase and that the risk of economic imbalances has declined. S&P’s view is based on their expectation that real estate prices will increase moderately in nominal terms and that lending growth will remain cautious and mainly driven by infrastructure investments.”

Expansionary phase? Real estate prices up moderately in nominal terms? Infrastructure investments?!?

Look, I’ll take it. I’ll take it with a smile.

Revenue slipped at Hudaco and it’s apparently South Africa’s fault (JSE: HDC)

At least operating margin moved higher

Hudaco released results for the six months to May 2025. Revenue fell by 2.4%, with the company making many references to overall conditions in South Africa. Despite this, operating profit increased by 1.5% and operating margin moved up from 10.4% to 10.8%, so they managed to turn water into wine (and plenty of whine in the narrative).

By the time you get to HEPS, you find a jump of 19.6%. This is because of a fair value adjustment related to the Brigit Fire vendor liability. HEPS is good, but it doesn’t catch every single distortion. Helpfully, Hudaco disclosed comparable earnings per share without that adjustment, which increased by 6.1% (a solid outcome based on the revenue pressure).

Solid cash generation in the period supported an increase in the interim dividend per share of 7.7%.

Looking deeper, the segmental trend has continued: consumer-related products are under pressure with sales down 6% thanks to lower volumes. They saw a strong uptick in operating margin though, from 9.9% to 11.3%. In engineering consumables, sales fell by 1.2%, so the more resilient part of the business couldn’t find its way into the green in this period. Operating profit fell by 2% in that segment as margins went the wrong way.

The outlook statement continues to blame South Africa for Hudaco’s challenges. Whilst I don’t doubt that things aren’t easy, aren’t these executives being paid a great deal of money to find ways to create shareholder value despite the challenges? It always frustrates me when listed companies throw their hands up in the air, especially when the dividend payout ratio is just 37%. If you’re retaining two-thirds of shareholder capital, you need to do something with it beyond just complaining about South Africa. If you can’t figure that out, then pay a higher dividends.

Reinet has agreed to sell Pension Insurance Corporation – at a discount to Reinet’s NAV (JSE: RNI)

What will they do with all this money?

Reinet recently responded to speculation about a potential sale of Pension Insurance Corporation. They confirmed that they had been approached by a potential buyer. Things have subsequently moved quickly, with a subsidiary of Athora Holding (a European savings and retirement group) looking to buy Reinet’s entire 49.5% stake in Pension Insurance Corporation. This is part of a broader deal in which all shareholders in the company are selling to Athora.

Based on the March 2025 accounts, this stake was 53.7% of Reinet’s net asset value (NAV). This comes after they sold their British American Tobacco stake, leading to cash and liquid funds being 26.3% of Reinet’s NAV as at March 2025. The private equity and partnership investments were less than 20% of NAV, so this disposal turns Reinet into a group that will have so much cash once this transaction closes in 2026 that Johann Rupert might even need to sleep with his doors locked once more. We won’t tell Trump.

Reinet notes that the proceeds will be used for ongoing investment purposes. To deploy this extent of capital alongside the British American Tobacco proceeds, they must have a gigantic deal in mind. I really hope it won’t just be spread around the various investment funds they have already allocated capital to, as that will lead to Reinet trading at a substantial discount to NAV.

The price on the table is £5.7 billion for 100% of Pension Insurance Corporation. This implies a value of £2.8 billion for Reinet. They recognised the stake at a value of €3.7 billion as at March 2025, which converts to £3.2 billion at current exchange rates. In other words, Reinet is selling at a discount of 12.5% to the last value at which they carried it in their accounts.

Although they expect the price to tick up to £5.9 billion for the entire thing once dividends have been taken into account, we need to compare the current value to the NAV rather than the expected eventual price.

Discount aside, they have invested £1.1 billion in this stake over the years, starting with £0.4 billion in 2012. They’ve received £0.4 billion in dividends. That’s a net investment of £0.7 billion to get £3.2 billion out – not bad at all!

Nibbles:

  • The joke that is aReit (JSE: APO) continues. The company is suspended from trading because they haven’t done financials for the year ended December 2023. The reason? Their auditors are reliant on third party confirmations from auditors of some of their tenants, with an unclear timeline for this to become available. How on earth is a listed company in a position where they are reliant on auditors of tenants for their accounts to be done? Every possible warning sign was there when this thing listed. As regular readers may recall, I didn’t make myself popular when they came to market and I certainly have no regrets, as it turned out even worse than expected.

Who’s doing what this week in the South African M&A space?

Marylou Greig
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Who’s doing what this week in the South African M&A space?

Exchange-Listed Companies

Trellidor has entered into an agreement with Sole Ceramics to dispose of the operations of Taylor Blinds and Shutters and NMC South Africa. The operations have failed to deliver to expectations and no synergies exist between these businesses and the core business Trellidor. The disposal tag is capped at R90 million with the proceeds to be allocated to reducing debt and strengthen the liquidity of the Group.

Hyprop Investments has disposed of a 50% stake in the Hyde Park Corner property to a subsidiary of Millennium Equity Partners for a consideration of R805 million with an option to dispose of/acquire the remaining 50% of the property to be exercised between 31 August and 30 November 2027. The proceeds will be allocated to reducing debt in the short term and for asset management initiatives, organic growth opportunities and new investments within Hyprop’s existing operations.

Fintech group Lesaka Technologies is to acquire Bank Zero Mutual Bank, the South African digital bank based on a zero-banking fees, in a deal valued at R1,1 billion. The transaction will be settled through the issue of shares (c.R1 billion) and up to R91 million in cash, resulting in the shareholders of Bank Zero holding a c.12% stake in Lesaka. The deal paves the way for a change in the way Lesaka will conduct its business, maximising synergies by combining Bank Zero’s digital banking infrastructure and operational banking licence with its fintech and distribution platform. The broader Bank Zero leadership team will remain in their current roles.

In a further announcement Lesaka Technologies advised that its Netherlands subsidiary Net 1 Applied Technologies had completed the sale of its entire equity interest in One Mobikwik Systems which is listed on the Indian Stock Exchange. The sale generated cash proceeds of US$16,3 million (R290 million).

EMedia (EMH) and Remgro subsidiary Venfin announced a transaction which will see eMedia take control of the entity EMI that holds its stake in e.tv., eNCA, OpenView and Yfm. The parties have agreed to a share swap whereby Venfin will exchange its 32.31% stake in EMI for 220 million EMH N shares, valued at R715,5 million. In addition, Venfin will subscribe 18,3 million EMH N shares at a subscription price of R3.25 per share amounting to R59,5 million – representing a 20% premium to the 30-day VWAP of 25 June. In due course, Remgro intends to distribute its EMH stake to its shareholders.

Reinforcing its strategic positioning in Spain, Lighthouse Properties has acquired a further shopping mall, adding Espacio Mediterràneo which is in Cartagena in the province of Murcia. The purchase consideration of €135,4 million reflects a gross asset yield of c.7.0% (before transaction costs).

Following press speculation that Reinet Investments was in talks regarding a possible sale of its 49.5% stake in Pension Insurance Corporation, the company confirmed that it had reached an agreement with Athora Holding, a European savings and retirement group managing €76 billion of assets on behalf of 2,8 million policyholders. The terms of the disposal imply a consideration payable for 100% of the fully diluted share capital of PIC of c. £5,7 billion which is expected to accrue to c.£5,9 billion, including expected dividends, ahead of closing.

Shareholders of Barloworld have been notified that the Independent Board has agreed to extend the acceptance date of the consortium’s Newco Standby Offer given that there are still a number of regulatory issues to finalise. As a condition to the extension, Newco has agreed to pay a break fee of R20 million to Barloworld if conditions are not fulfilled by the Longstop date. Acceptances currently stand at c.34.4% which together with shareholdings of the consortium and the Barloworld Foundation equates to 57.7% (excluding treasury shares) – above the 51% minimum requirement Newco stipulated it would need for the Standby Offer to be implemented.

In December 2023, Sun International South Africa announced the planned acquisition of the Peermont Group in an equity transaction valued at R3,24 billion (enterprise value of R7,3 billion). In October 2024 the Competition Commission recommended that the Competition Tribunal prohibit the deal. Fast forward to July 2025, the Tribunal is still to rule on the matter, this week issuing a date of 2 October 2025 for the hearing and closing arguments. The parties have extended the Regulatory Longstop Date over this period to accommodate a ruling but have now mutually agreed to the immediate termination of the proposed transaction as the hearing date falls beyond the latest Longstop Date of 15 September 2025.

Unlisted Companies

South African venture capital firm Knife Capital has announced investments in two local startups – Sticitt, a fintech innovator in school payments and Optique, a disruptor in the optometry space. The new Series A investments were made through its KNF II fund. Details on the size of investments were not disclosed.

Intengo Market, a South African digital platform enhancing liquidity, transparency, and price discovery, and offering tools and analytics to support the debt issuance and trading process, has acquired Addendum’s secondary market platform. The acquisition creates a comprehensive ecosystem for both primary and secondary debt markets by consolidating primary and secondary market functionalities into a single platform. Financial details were undisclosed.

In a significant milestone for South Africa’s maintenance, repair and overhaul (MRO) industry, Nordbak, a local specialist provider of MRO solutions with a strong foothold in mining, infrastructure and industrial segments has been acquired by Henkel in a strategic move to strengthen its Adhesive Technologies business in South Africa. Financial details were not disclosed.

DealMakers is SA’s quarterly M&A publication.
www.dealmakerssouthafrica.com

Weekly corporate finance activity by SA exchange-listed companies

Marylou Greig
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Weekly corporate finance activity by SA exchange-listed companies

In a pre-close update to shareholders Resilient REIT said while its investment in Lighthouse Properties remains a core component of its offshore strategy, the company had taken advantage of strong market conditions and disposed of a portion of the investment to fund the development pipeline. Resilient currently owns 27.6% of Lighthouse following the disposal of 39,2 million Lighthouse shares for proceeds of R332,2 million.

Castleview Property Fund has concluded a share subscription agreement with Select Opportunities Fund En Commandite Partnership in terms of which Castleview will issue a maximum of 30,487,805 shares at R6.56 per share for a maximum value of R200 million. The subscription price represents a 20% discount to the spot price of Castleview. Since the subscriber is a related party, an independent expert has been appointed.

PBT Group has declared a capital reduction distribution of 17.50 cents per PBT share to be paid to shareholders on 21 July 2025.

Efora Energy has advised of a further delay to 31 July 2025 in the release of its results for the year ended 28 February 2025, with the annual report anticipated by 31 August 2025. African Dawn has also advised delays saying it expected to publish its audited annual financial statements by 31 August 2025 and distribute its Annual Report by 30 September.

Shareholders have approved the intended Rights Offer by Accelerate Property Fund which aims to raise R100 million by way of a fully underwritten renounceable offer. The company will issue 250 million shares at R0.40 per share.

The JSE has advised that the following companies – African Dawn Capital, Brikor, Copper 360, Efora Energy, Visual International and Sable Exploration and Mining – have failed to submit their annual report within the four-month period stipulated in the JSE’s Listing Requirements. Should they fail to submit their annual reports before 31 July 2025, their listings may be suspended.

This week the following companies announced the repurchase of shares:

Following the closing of the Viterra/Bunge merger announced in June 2023, Glencore received 32,8 million shares in Bunge, representing 16.4% of the enlarged company. Glencore is of the view that the NYSE-listed Bunge shares represent surplus capital. The shares have a current market value of c.US$2.63 billion, the value of which (up to $1 billion) the Group intends to use to underpin a new buyback programme.

Pan African Resources has commenced the share buyback programme announced in early June 2025. The programme will take place on the AIM Market of the LSE and the JSE with c.R200 million (c.£8,2 million) to be purchased across both exchanges. This week 420,317 shares were repurchased at an average price of 46.89 pence per share for an aggregate £197,087.

In October 2024, Anheuser-Busch InBev announced a US$2 billion share buy-back programme to be executed within the next 12 months which will result in the repurchase of c.31,7 million shares. The shares acquired will be kept as treasury shares to fulfil future share delivery commitments under the group’s stock ownership plans. During the period 23 to 26 June 2025, the group repurchased 786,256 shares for €46,69 million.

Hammerson plc continued with its programme to purchase its ordinary shares up to a maximum consideration of £140 million. The sole purpose of the buyback programme is to reduce the company’s share capital. This week the company repurchased 213,431 shares at an average price per share of 299 pence for an aggregate £639,931.

In May 2025, British American Tobacco plc extended its share buyback programme by a further £200 million, taking the total amount to be repurchased by 31 December 2025 to £1,1 billion. The extended programme is to be funded using the net proceeds of the block trade of shares in ITC to institutional investors. This week the company repurchased a further 639,622 shares at an average price of £34.41 per share for an aggregate £22 million.

During the period 23 to 27 June 2025, Prosus repurchased a further 3,379,017 Prosus shares for an aggregate €160,83 million and Naspers, a further 434,976 Naspers shares for a total consideration of R2,39 billion.

One company issued a profit warning this week: Visual International.

During the week two companies issued or withdrew cautionary notices: ArcelorMittal South Africa and Blue Label Telecoms.

DealMakers is SA’s M&A publication.
www.dealmakerssouthafrica.com

Who’s doing what in the African M&A and debt financing space?

Vanessa Aitken
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Who’s doing what in the African M&A and debt financing space?

DealMakers AFRICA

Miro Forestry and Timber Products, a sustainable forestry and plywood manufacturing company employing over 4,000 people in Sierre Leone and Ghana, has secured new funding in a round led by Lagata, a specialist in forestry investment. Existing shareholders British International Investment, FMO, and Finnfund, as well as Mirova are also participating in the new capital raise.

West African mobile money platform, Wave Mobile Money, has raised US$137 million in debt financing. The funding round was led by Rand Merchant Bank and included British International Investment, Finnfund and Norfund. Wave operates in eight markets across Africa and will use the funding to boost working capital and drive expansion across existing and new markets.

Kenyan mobi-tech startup, BuuPass, has secured investment from Yango Ventures the corporate venture capital arm of global ride-hailing and tech conglomerate Yango Group. BuuPass offers a comprehensive platform that enables users to book buses, trains, flights, and parcel delivery services, while also equipping transport operators with back-office tools for managing inventory, payments, and fleet logistics.

Persea Oil, an avocado oil processing company operating in Kenya and Tanzania has secured a US$1 million loan facility, comprising $500,000 for working capital enhancement and a $500,000 for capital expenditure, from Sahel Capital through its Social Enterprise Fund for Agriculture in Africa (SEFAA).

Egyptian agri-fintech, AgriCash, has raised an undisclosed amount in seed funding in a round led by Alex Angels that also included participation by regional investors. Founded in 2024, AgriCash provides farmers with a digital financing platform offering AI-powered agronomic insights, crop insurance, BNPL financing, and access to markets. The new capital will help scale operations across Egypt and expand into regional markets, enhance its AI-driven infrastructure and finalise integrations with key insurance and financial partners.

DealMakers AFRICA is the continent’s quarterly M&A publication
www.dealmakersafrica.com

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