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Ghost Bites (Accelerate Property Fund | ASP Isotopes – Renergen | Assura – Primary Health Properties | MAS | Thungela)

The Finance Ghost
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Ghost Bites (Accelerate Property Fund | ASP Isotopes – Renergen | Assura – Primary Health Properties | MAS | Thungela)

Accelerate Property Fund: Azrapart is a massive overhang once more (JSE: APF)

They cannot afford any further nasty surprises

Accelerate Property Fund is a great example of a highly speculative play in the market that could go one of two ways based on not just economic considerations, but also legal battles. The net asset value (NAV) has dropped considerably to 203 cents per share as at March 2025, but this is still way above the current share price of 43 cents. Hence, the opportunity for those who are brave.

Why the large discount? Well, the market knows that if the keys to the castle end up in the hands of the banks, then shareholders can easily watch their disappear into the hands of debt providers rather than shareholders. Property funds do give a better chance of dishing out net proceeds from a business rescue process than operating companies, as there are at least clearly identifiable underlying assets that have proper values, but it’s still not fun.

Speaking of the assets, the total portfolio as at March 2025 was R7.75 billion, which is well ahead of interest-bearing borrowings of R3.75 billion. It’s also worth highlighting that although the interest coverage ratio of 1.2x and loan-to-value ratio of 47.6% aren’t exactly on the right side of debt covenants by much (1.1x and 50% respectively), Accelerate is in compliance with the requirements of its bankers. Well – mostly, that is.

My understanding is that one of the terms for ongoing support by lenders is a resolution to the related party issues. Despite much hope that a settlement agreement with Michael Georgiou’s Azrapart (the holder of the other 50% in Fourways Mall) would be signed on materially the same terms as the agreement that lapsed last year, this hasn’t happened. With Azrapart now in a business rescue process, I suspect the issue is that the decision-makers have changed on that side.

Having spent considerable time combing through the latest announcement and the related party settlement plan that was announced in 2024, it looks like Accelerate’s obvious risk is a payable to Azrapart of R300 million related to a claim regarding Fourways Mall. In turn, Azrapart owes Accelerate far more than that, like R540.6 million for the headlease and R430 million across various other amounts. The idea was that these amounts would all be set-off, along with Accelerate acquiring further assets (bulk worth R75 million and parking worth R241.5 million) from Azrapart. There was also an amount that would be set off in relation to the internalisation of the property management company.

This is an extremely technical issue and the devil will undoubtedly be in the details of the legal agreements. From what I can see, aside from the immense irritation around the bulk, parking and management agreement issues, Accelerate’s cashflow risk is needing to pay R300 million to Azrapart in a claim that perhaps won’t be capable of set-off against the other claims.

Accelerate’s balance sheet is tighter than a duck’s you-know-what, so they can’t afford this – or at least, not yet. They have R1.3 billion in property recognised as being held-for-sale, as well as agreements in place to sell properties worth R688.5 million, with Portside as the largest at R580 million. Sure, there must be debt settlements tied to such properties, but that would at least generate some liquidity to deal with Azrapart in a worst-case scenario. Hopefully, the legal wrangling will lead to a situation where Accelerate isn’t forced to part with R300 million in cash to receive nothing in return.

The good news is that the R300 million is recognised on the balance sheet as a liability and they’ve fully written-off the receivables from Azrapart, so the NAV per share of 203 cents per share has some conservatism baked into it. The risk is really around cash and liquidity rather than whether there is decent net value in this thing.

Let’s look to the future. The group is aiming to get to a loan-to-value ratio below 40%, along with an interest coverage ratio of 1.6x. The R100 million rights offer that was concluded after year-end is helpful here, but they will only get there if asset disposals go well and if the performance at Fourways Mall improves.

In terms of earnings, rental income for the year ended March 2025 was down R37.3 million, with the headlease benefit at Fourways Mall more than offsetting disposals. The rest of the decline was due to negative reversions at Fourways Mall, presumably as part of improving the vacancy rate at the mall. Fourways Mall’s vacancy rate has improved from 19.0% to 13.7%. It makes sense to me that it’s better to create a vibey mall that is full of tenants than to be stubborn on price and have loads of empty shops.

Property expenses were only down R4.6 million despite the disposals, so there’s clearly pressure on net property income, which fell by 8.3% to R495 million.

Net finance costs were down 42.3% vs. the prior year, coming in at R272 million vs. R472 million. This means that the company is able to cover its finance costs with its net property income.

To add to this pain, there’s a negative fair value adjustment of R274.3 million in the portfolio. At least that’s better than R354.8 million in the prior year, but what is obviously really needed is some stability in valuations. The total fair value adjustment on the income statement is larger due to movements in other financial items.

Accelerate is as speculative as they get, with the situation having worsened thanks to the Azrapart issue. They simply cannot afford any further negative surprises, with the transaction circular for Portside expected to be posted before 31 August 2025 (the JSE has already granted an extension here).

As a final comment, the current share price of 43 cents is slightly above the recent rights offer price of 40 cents per share.

ASP Isotopes will list on the JSE later this month (JSE: ISO)

Although not conditional on the Renergen (JSE: REN) deal, that’s an important part of the plan

As things currently stand, the scheme of arrangement that will see ASP Isotopes acquire Renergen has met almost all its conditions for implementation. We are at the point where a standby offer won’t be triggered, so we know for sure that the scheme is the way forward.

This is important, as the Renergen deal is key to ASP Isotopes achieving a reasonable spread of shareholders in its JSE listing. The listing isn’t conditional upon the Renergen deal, but is certainly boosted by it. ASP Isotopes will be listed on the JSE from 27 August 2025.

The abridged pre-listing statement is now available, giving plenty of additional detail around this cutting edge company that takes advantage of an area in which South Africa can compete with the very best in the world. But if you really want to get to grips with their core business, I can wholeheartedly recommend watching the Unlock the Stock event that featured the CEO of ASP Isotopes. At the time, the Renergen deal hadn’t been announced (and we had no idea it was coming), so the entire session was based entirely on ASP Isotopes’ core business.

Here’s the link to the recording:

Assura reaffirms its support for the Primary Health Properties deal (JSE: AHR | JSE: PHP)

KKR and Stonepeak tried to sow seeds of doubt before the offer closes

I tried to find some kind of press release or public statement by KKR and Stonepeak, the competing bidders for Assura, that would’ve triggered the activity on SENS on Friday from both Assura as the target and Primary Health Properties as the favoured bid. Alas, I had no luck in locating it.

Whatever it was, it seems as though KKR and Stonepeak took note of the low acceptance rate by Assura shareholders and used it as an invitation to remind shareholders that its cash offer is still on the table. A share-for-share merger (whether there’s a cash portion or not) opens itself up to these kind of attacks, as the implied price for the target company changes every time that the share price of the acquiring firm moves. In contrast, a cash bid is set in stone, so shareholders know exactly what the value of the bid is.

The Assura board came out with a statement reminding the market that they support the bid by Primary Health Properties. Later in the day, Primary Health Properties reminded Assura shareholders of the benefits of the deal and that the offer period will close on 12 August.

As things stood on Friday, acceptances had only been received from holders of 3.68% of Assura shares. There’s a long way to go…

Despite a lot of noise in the market, the MAS board reckons that the Prime Kapital offer is legally valid (JSE: MSP)

I’m personally not surprised, given the level of the people involved

My DMs have been busy the past couple of weeks. Based on the podcasts that I’ve done with Martin Slabbert of Prime Kapital (including the most recent one that also featured Johan Holtshausen, Chairman of PSG Capital and advisor to Prime Kapital), there have been a number of asset and wealth managers who have shared their concerns with me about the Prime Kapital bid for MAS.

This is good. Debate is healthy for a market – but I must point out that concerns around timing etc. fall rather flat when the competing Hyprop bid, which was meant to be a “white knight” for the asset management community, had a far more aggressive timeline than the Prime Kapital bid. Many of the other concerns raised with me were on technical legal points, particularly related to whether Prime Kapital is even legally entitled to make an offer.

I found this interesting, as the Prime Kapital team definitely did not strike me as people who act without sound legal advice. Getting legal advice and being legally correct are of course two different things, but on something as obvious as whether a bid is a reserved matter in the joint venture relationship (i.e. needs the approval of MAS for the bid to be made), I would’ve been extremely surprised if they had gotten it wrong.

Sure enough, the MAS board has now released an announcement dealing with a number of these issues. I’m going to repeat the paragraph about legal validity verbatim:

“Having carefully considered the largely unregulated nature of the PKI Voluntary Bid and the contractual relationships which underpin the DJV, and having obtained comprehensive South African, English and Maltese law advice, the Independent Board is of the view that there are no legal grounds or formal procedures available that would enable MAS to delay or amend the PKI Voluntary Bid timeline in any way, nor is it able to challenge the implementation thereof by PKI.”

That’s a pretty strong statement.

The announcement by MAS is incredibly detailed and I won’t go into everything here. The TL;DR is that the investment mandate that was revised in 2020 gives the joint venture the power to invest in listed securities, which of course includes MAS, provided that the securities will “optimise returns” – and for further clarity, investment in securities issued by MAS is expressly permitted in the mandate. Then, in terms of the restricted matter, MAS notes that because the preference shares would be issued by a subsidiary of the joint venture and not the joint venture itself, it falls outside of the ambit of restricted matters.

That may sound too cute or even unfair to you, but there’s no concept of fairness in commercial stuff like this. The agreement says what it says. Nothing would ever get done in corporate finance if everyone argued about fairness, as (1) that means different things to different people and (2) parties with commercial incentives will argue for fairness based on their subjective position, not an objective view. Where fairness is required in corporate law, it is expressly provided for e.g. in takeover law regarding treatment of minority shareholders. Two large corporate parties negotiating with each other can (and will) work towards getting the best possible positions for themselves, with the important thing being that there are no directors sitting on both sides of the table who are conflicted at the time of the agreement. This is where the legal concept of “disinterested” directors comes in – and no, it’s not a reference to how much they are looking forward to the next coffee break on the day of board meetings.

Speaking of what is fair to shareholders, one of the most interesting nuances of this deal is that MAS is effectively in a regulatory black hole. The company’s legal jurisdiction is Malta, where there is no such thing as takeover law in their companies act. The only takeover law application would be for companies listed in Malta or supervised by the Malta Financial Services Authority, of which MAS is neither. And even though MAS is listed on the JSE, it isn’t a South African company, hence the South African takeover regulations also don’t apply.

They’ve also noted that they can’t get an independent expert to opine on the transaction in time, given the tight offer timeline. This is the same situation that we unfortunately saw in the Hyprop offer that was subsequently withdrawn.

This means that shareholders are on their own here and won’t be able to rely on the opinion of an independent expert. But given that the underlying portfolio consists of properties that are in any event revalued at every reporting date, there’s enough information in the net asset value of the fund for shareholders to work on. In other words, this isn’t an operating company where the market would benefit tremendously from an independent expert digging through the numbers and performing a detailed valuation.

For all the irritation in the market around this matter, I must point out that the cash offer on the table, as well as the implied price under the preference shares, is a substantial premium to the share price calculated over just about any reasonable period this year. It might be at an implied discount to tangible net asset value per share, but trading at a discount is a feature of property companies on the JSE.

The full announcement by MAS goes into tons of detail on these and many other underlying points, including the risks of the deal with elements like irrevocable undertakings and the unusual timeline (the offer closes on 14 August). They correctly highlight the uncertainty regarding the liquidity of the preference shares (a point I’ve been constantly writing about) and the uncertain nature of the total cash element of the bid.

Again, I would encourage you to consider all the facts at hand when forming your own view. There is no such thing as altruism when it comes to corporate dealmaking – with billions at stake, the parties on either side of the table are incentivised to get the best deal for themselves. The Hyprop offer was the best deal in town for the asset management community, as they are already deeply invested in Hyprop. Hence, I didn’t see too many complaints from asset managers about the timeline of that offer, conditional nature of that deal or the requirement for irrevocable undertakings when there are still major conditions at play, but I’ve seen plenty of noise about the Prime Kapital offer. I understand the incentives at play here and you should make an effort to do the same.

We haven’t heard the last of this matter. In fact, I doubt we are even close. Regardless of what happens in the offer this coming week, there’s still the extraordinary general meeting to get through with a potential change to the board.

The sharp end of M&A is an exciting thing!

Thungela’s HEPS has plummeted (JSE: TGA)

The coal market hasn’t been kind to them

When you’re investing in mining groups that have exposure to just one commodity, you’re really rolling the dice. The cyclicality of commodity prices is no joke, which is why investors often turn to the more diversified mining groups for their resources exposure. At Thungela, you get a pure-play on coal – for better or worse.

In the six months to June 2025, it was definitely for the worse. HEPS has fallen by between 78% and 85%, a hideous outcome that reflects not only the tough conditions in the coal market, but also the restructuring costs of R285 million that Thungela has recognised in relation to Goedehoop and Isibonelo.

Detailed results are due for release on 18 August. With the share price down 30% year-to-date, the market will pay close attention to them.

Nibbles:

  • Director dealings:
    • The CEO of Invicta (JSE: IVT) certainly isn’t playing around, buying shares in the company worth R17 million.
    • An associate of the CEO of Acsion (JSE: ACS) bought shares worth R1.05 million.
    • The CEO of Spear REIT (JSE: SEA) bought more shares for his kids, this time to the value of R24.4k.
    • The CEO of Vunani (JSE: VUN) remains on the bid, buying shares worth R2.4k.
  • Hulamin (JSE: HLM) has reached an important milestone linked to its R500 million capital investment that was announced back in 2022. This investment was designed to increase local manufacturing of cans, thereby reducing reliance on imports. The first two phases of the investment were completed in 2024 and the final phase was completed in July this year. The testing was successful, with the mill now processing trial wide-width canbody coils. The focus for the rest of the year is to complete product qualification, with commercial readiness targeted for the end of Q1 2026.
  • Alphamin (JSE: APH) releases such detailed quarterly production updates that the actual filing of financials is practically a non-event, such is the level of information already digested by the market. But what is interesting, apart from the declaration of a dividend, is that the new controlling shareholder (International Resources Holding) has appointed two directors to the board of the company.
  • Delta Property Fund (JSE: DLT) shareholders gave strong approval to the disposal of 88 Field Street, a deal that is now unconditional.
  • UK property fund Hammerson (JSE: HMN) has finalised the acquisition of the other 50% stake in Bullring and Grand Central, taking their ownership to 100%. This deal was announced recently along with a more encouraging outlook on regional property valuations.
  • Due to ill health, the CEO of Wesizwe Platinum (JSE: WEZ) has stepped down from his role. It’s almost sad seeing something like that, where somebody’s career has been cut short by a factor outside of their control.

Autonomous Investing (AI) – Myth or Reality?

Nico Katzke, Head of Portfolio Solutions at Satrix
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Autonomous Investing (AI) – Myth or Reality?

In an age dominated by AI innovations that blur the lines between reality and generative fiction, autonomous investing seems like the logical next frontier. Here, Nico Katzke, Head of Portfolio Solutions at Satrix* explores which parts of investing are likely to be impacted by AI – and (spoiler alert), the impact may not be what you expect. He unpacks this by looking at the main tools investors use to manage their funds.

Advisory Space

Investing is – and should be – a highly subjective exercise. Risk and return preferences are linked to one’s investment horizon, risk appetite and liquidity needs. If you’re investing for 12 months with a high chance you’ll need the money sooner, advice is simple: keep it safe and liquid. If you’re investing for 10+ years with little likelihood of needing the funds, your biggest risk is not taking enough risk.

Tax considerations matter too, as does the emotional challenge of staying invested – this is where advisers can be worth their weight in gold.

AI can, in theory, offer helpful generic investment advice – but only if prompted precisely and fed the right context. Robo-advisers haven’t seen the uptake many expected, and for good reason: advice is a deeply personal, human process. It often requires empathy, flexibility, and nuance; things AI doesn’t yet do well.

Investment Management

AI will certainly influence investment management but perhaps not in the ways we expect. Index investing (rules-based by nature) is a good example. Vanilla index rules are fixed. Stock weights in, say, the S&P 500 or JSE Top 40 are based on market cap. Since no discretionary decisions are made, vanilla indexation won’t be directly impacted by AI.

Instead, the impact will be indirect. As AI and machine learning make traded prices more efficient, index weights better reflect available information – which in turn makes it harder for active managers to find price inefficiencies. Opportunities will exist, but consistent outperformance will become scarcer.

Where AI might have more direct impact is in non-vanilla indexation – where rule design is more flexible. In the US, we’ve seen a proliferation of strategies with active design features. Locally, the Satrix Global Factor Enhanced Index uses machine learning to adapt weights based on stock and sector sentiment, risk regimes and other dynamic factors. This allows for unemotional, data-driven weighting using up-to-date information.

Criticisms like overfitting (great on paper, weak in future performance) and data integrity (garbage in, garbage out) apply to automated strategies – but humans aren’t immune to these either. If anything, AI and humans may end up managing side by side: machines offering efficiency and consistency, humans providing insight and emotional intelligence.

We believe vanilla passive (broad, low-cost exposure), non-vanilla indexation (intelligent rule-based exposure), and active management will all have roles in a more complex investment landscape. But more complexity doesn’t always mean better outcomes – and cost still matters. Ironically, the simplest low-cost passive strategy – where weights reflect an increasingly efficient market – may remain one of the most effective over time.

Discretionary Investing

AI is already a useful tool for managing discretionary portfolios. It’s great at summarising company info and aggregating macro views, helping novice investors make better decisions. DIY investing can be a great way to learn about markets, and some investors find it keeps them from fiddling with their long-term portfolios, which often benefit most from being left alone.

Having both a long-term strategy (with advice and cost-effective vehicles in place) and a DIY discretionary portfolio can be rewarding – both financially and educationally.

Final Thoughts

Given the rise of generative AI, it seems natural to believe the future of investing lies in automation. While data and tech will shape all areas of asset management, fully autonomous investing won’t be viable for most. AI should improve investor outcomes indirectly by reducing overall costs and making the industry more efficient; but hoping that it may disintermediate advisers or make managers redundant is likely to be a bridge too far.

*Satrix is a division of Sanlam Investment Management

Disclaimer

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.  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

A whole lotta gain, a whole lotto lose: the tale of Tonda Dickerson

Dominique Olivier
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A whole lotta gain, a whole lotto lose: the tale of Tonda Dickerson

By the time she was driving her bleeding ex-husband to the hospital, Tonda Dickerson had already been sued by her co-workers, taken to court by a truck driver, and become Alabama’s most unlikely millionaire. And it all started with a single lottery ticket.

The year: 1999. The place: an ordinary diner in Grand Bay, Alabama, where a woman named Tonda Dickerson was working as a waitress. 

By the age of 28, Tonda had lived a life that could inspire a country song. She was a divorced single mother who had walked away from an abusive marriage with nothing but her determination and whatever she could fit into a suitcase. By 1999, she was working five shifts a week at the diner. It was barely enough to cover her bills, but it was steady work. 

That all changed on the morning that Edward Seward, a regular patron of the diner, tipped Tonda with a lottery ticket instead of cash. Technically, lotteries are not allowed in Alabama (due to state laws), but Edward was a long-haul trucker who made a habit of buying lottery tickets in other states and carrying them around with him. This particularly fateful lottery ticket had been bought in Florida. 

It was meant as a quirky gesture. No one – least of all Tonda – thought it would amount to anything. A week later, the winning numbers were announced, and Tonda’s ticket hit for $10 million. Just like that, the woman pouring coffee in a diner uniform became Alabama’s unlikeliest millionaire.

The unmistakable scent of opportunity

As you might imagine, winning the lottery is like ringing a dinner bell for opportunists. Within days, four of Tonda’s fellow waitresses lawyered up. They claimed there had been a pact between them that if any of them ever won from a customer’s ticket, they’d split it evenly. When Tonda disagreed, they took her to court. 

Tonda’s opposition even produced a witness in the form of a diner who swore she’d overheard Tonda talk about it right there in the restaurant. Tonda countered that the so-called “customer” was just a friend roped into the scheme, but the judge was unconvinced. The initial ruling went against Tonda, ordering her to share the winnings. But then an Alabama district court reversed it, noting that the agreement – being tied to gambling – wasn’t enforceable under state law.

Next in line was Edward Seward, the trucker who’d tipped her the ticket. When he learned that she’d won, he called up a lawyer of his own. His argument was that Tonda had supposedly promised to buy him a new truck if she won – and he was keen to collect on that promise.

Here’s where a bit of legal jargon called promissory estoppel comes in, which dictates that you can be held to an oral promise if a court decides it was reasonable for the other party to rely on it. But this particular court didn’t buy it. Statistically, a lottery ticket is worth less than the paper it’s printed on. No reasonable person, they decided, could expect a multi-million-dollar return, much less from a ticket they had willingly given away. Hence, Seward’s case was tossed out and his hopes of cashing in on Tonda’s win were erased.

If you can believe it, things got worse from there

Not long after the win, Tonda’s abusive ex-husband found out about her windfall. One afternoon, he appeared outside her home without warning and forced her into his car. He drove in silence at first, heading out of town toward a remote part of rural Alabama. When he finally spoke, it was to tell her he planned to kill her and take the money for himself.

About 20 minutes into the drive, his phone rang. While he was distracted, Tonda reached into her purse for the gun she’d started carrying after their divorce. She aimed it at him. He lunged across the seat to try and take it from her, and in the struggle she fired, hitting him in the chest.

Miraculously, he didn’t die. In a twist that is a testament to her character, Tonda urged him to get medical help, even switching seats with him so she could drive him to the hospital herself. He survived, served a short prison sentence for the kidnapping, and she walked away alive (and still rich).

Not a fix-all after all

Tonda’s story is dramatic, but sadly not unique. In fact, financial advisors have been warning for years that winning the lottery often brings more problems than solutions.

Statistics show that lottery winners are significantly more likely to declare bankruptcy than the average member of society. The windfall often draws out estranged relatives, manipulative friends, and – in some cases – outright criminals. Add to that the fact that most people are not financially disciplined or skilled enough to know how to handle a sudden influx of money, and you’ve got a recipe for disaster. 

Just ask:

  • Amanda Clayton, who won $1 million, kept claiming food stamps, was convicted of welfare fraud, and died of an overdose within a year.
  • Michael Carroll, who blew £10 million on drugs, sex workers, and building a demolition derby in his backyard.
  • William Post, who won $16.2 million in 1988, was sued by his ex, and had his own brother try to hire a hitman to kill him. He died broke and estranged from his family.

When money appears overnight, it doesn’t just change your bank balance – the sad reality is that it changes the people around you – and not always for the better. Or perhaps it just reveals them?

Take a lesson from Tonda

Despite the rollercoaster ride that followed after her win, Tonda remained level-headed enough to make some very smart decisions. 

Firstly, she declined a lump-sum payout of her winnings and requested 30 annual payments instead. This meant that she would be less inclined to burn through the cash all at once, and that her millions would continue to sustain her for the next three decades of her life.

Then, she went back to work – not at the diner, but at a casino, where she was employed as a blackjack and poker dealer. It wasn’t glamorous work, but it kept her in a steady routine (which meant she didn’t spend every day lying on her couch flipping though catalogues) and most importantly, it meant that she kept earning an income instead of living off her millions.

I can only imagine that working in a casino and seeing people lose money through reckless decisions daily is somewhat of a spending deterrent as well.

Despite a little bit of IRS-related drama (she was sued by the American equivalent of SARS for not paying gift tax, and ended up having to pay about $700,000), Tonda’s life looks very ordinary these days. She goes to work, hangs out with her family and friends and collects her lottery cheque annually like it’s no big deal.

Stories like Tonda’s captivate us because they’re part fairy tale, part cautionary tale. We imagine the champagne cork popping, the debt-free life, the dream house. But we also know deep down that sudden wealth doesn’t erase old problems. In fact, it often magnifies them.

Lottery hopefuls, take note: a lottery win can be salvation or destruction, and sometimes, it’s both in the same year.

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 (ADvTECH | Blue Label Telecoms | Metair | MTN | RCL Foods | Sappi | The Foschini Group)

The Finance Ghost
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Ghost Bites (ADvTECH | Blue Label Telecoms | Metair | MTN | RCL Foods | Sappi | The Foschini Group)

ADvTECH pushes deeper into Africa as a growth area (JSE: ADH)

And their track record certainly supports this decision

ADvTECH’s schools business does well because it has a differentiated offering of private schools that appeal to high income parents. This has proven to be the right approach, with Curro (JSE: COH) struggling to fill its school footprint that is essentially a broader offering to middle-to-higher income parents. Let’s also not pretend that the birth rate isn’t a serious issue here, with a more focused offering of fancier schools looking less vulnerable than a wide footprint of underutilised schools.

Part of ADvTECH’s strategy also includes high quality schools in Africa, appealing to expats and wealthier locals. Again, it’s a good model. They are expanding this offering in Kenya through the acquisition of Regis Runda Academy for around R172 million. This will be rebranded as Makini Schools Runda, which means it will operate within ADvTECH’s existing brand in Kenya.

Given the track record of success with schools like these, this seems like a sensible acquisition to me.

Blue Label Telecoms plays its cards close to its chest (JSE: BLU)

A trading statement for the year ended May 2025 has the bare minimum disclosure

There’s a particular feature of trading statements that is very important for investors to understand: they are triggered by earnings moving by a minimum of 20% vs. the prior period. This means that when a trading statement notes that earnings moved by “at least 20%” then the company is essentially giving the bare minimum required disclosure. You can contrast this to MTN below for example, where the trading statement gives an earnings range.

Over at Blue Label Telecoms, despite this trading statement dealing with the year ended May 2025 (which is now behind us by a couple of months), they’ve only taken the route of indicating moves of at least 20%. This is across HEPS, core HEPS and earnings per share (EPS) as well. In reality, the likely move is significantly higher than that, evidenced by a share price that is up by a colossal 280% in the past 12 months!

Blue Label will release earnings on 27 August. They have indicated that a further trading statement will be released before then, dealing with a specific earnings range for these core metrics.

A bit of love from the market for Metair’s turnaround (JSE: MTA)

The share price closed 6% higher on the day of a trading update

Metair is busy with a tough turnaround. The company has far too much exposure to new car production in South Africa, a long-term risk that they are trying to mitigate by moving into the aftermarket parts business. Even if we stopped manufacturing cars tomorrow, there are still millions of cars on the road in South Africa. I therefore see it as a sensible strategy to tap into this market, executed through the acquisition of AutoZone that adds to existing businesses in this vertical that offer products like batteries.

Of course, it doesn’t hurt in the meantime if volumes at the South African manufacturers move higher, with the added benefit of Metair making progress with its strategy to improve businesses like Hesto Harnesses. Production volumes in the South African market increased by 4% this period. Thankfully, Metair’s customers don’t supply directly into the US market, so there’s no direct impact from tariffs. It’s about time that Metair had some good luck. They’ve had more than anyone’s fair share of bad luck!

For the six months to June 2025, revenue from continuing operations increased by between 52% and 54%. This immediately needs to be followed up by two important nuances. The first is that Hesto is now accounted for as a subsidiary, so its revenue wasn’t in the base period (it was accounted for differently before). The second is that AutoZone is now in these numbers and wasn’t in the base.

The percentage move is therefore unhelpful. It’s much more useful to just note that revenue will be close to R8.7 billion, with expected EBIT of R440 million to R460 million. As you can see, margins are still far too low in this business, coming in at just over 5%. AutoZone is a drag on margins at the moment with negative EBIT, as they acquired it out of business rescue and will need to improve its performance as quickly as possible to get the most out of that opportunity.

From continuing operations, HEPS is expected to be between 69 cents and 72 cents, down between 6% and 10%. This is a sign of stabilisation in the core business, as the driver of that decrease is the punt on AutoZone.

Importantly, Metair has met all covenants of its restructured debt package. They aren’t completely out of the woods yet (and there’s still the overhang of the European Commission’s investigation into battery manufacturers in Europe that impacts one of Metair’s businesses), but they are clearly on the right track.

MTN’s African subsidiaries have driven a wild positive swing in earnings (JSE: MTN)

Despite Nigeria and Ghana having already reported, MTN still rallied on this news as though it was a surprise

MTN’s share price is up 123% in the past year. That’s a pretty spectacular situation for investors, helped along by the share price closing 5% higher on Thursday in response to MTN releasing a trading statement for the six months to June 2025.

With MTN Nigeria and MTN Ghana having already released strong numbers for the second quarter, it was clear that the MTN group numbers would be solid as well. But the market seems to have gotten a positive surprise from just how good they were, otherwise we wouldn’t have seen another 5% rally on the day of results.

The percentage move is slightly insane, with HEPS improving by more than 300%. What this really means is a substantial swing from a headline loss per share of -256 cents into expected positive HEPS of 614 cents to 666 cents.

Detailed results are due on 18th August.

RCL Foods had a solid year – but the second half was much slower than the first half (JSE: RCL)

The sugar business had a tough end to the year

RCL Foods released a voluntary trading statement for the year ended June 2025. After an interim period in which underlying HEPS jumped by 28.9% and HEPS as reported was up 38.8%, shareholders will probably be disappointed to see that this is only a voluntary trading statement, as it means that the full-year move isn’t more than 20%.

Sure enough, HEPS from total operations will be between 5.6% and 12.6% higher, while underlying HEPS from continuing operations will be between 9.6% and 17.5% higher. Viewed in isolation, that would be decent. But after what happened in the interim period, it’s almost a tough pill to swallow.

The challenge in the second half was in the sugar business, with RCL Foods attributing the issues to the presence of imports that took market share from local volumes at a time when global sugar prices moved lower.

For all the significant movements in earnings, the share price has managed to come out flat over 12 months.

The Sappi rollercoaster ride continues (JSE: SAP)

I don’t think there’s a more volatile sector out there than paper

Do you miss Ratanga Junction in Cape Town? Wish you could get to Gold Reef City more often? Well… do I have a stock for you!

If that’s what the volatility looks like over such a long period, you can imagine what it looks like from one quarter to the next. For example, in the quarter ended June 2025, revenue fell 4% year-on-year and adjusted EBITDA tanked by 46%. With net debt up 45%, this combination was enough to push them into a net loss of $33 million vs. profit of $51 million in the comparable quarter.

But if we look over the nine months to June vs. the comparable nine months, the situation is reversed in terms of net profitability. Despite revenue being up just 1% and adjusted EBITDA falling by 15%, the bottom of the income statement shows a swing from a loss of $46 million to profit of $17 million.

The reason for profits that bounce around like a Jack Russell on heat is that the global paper sector is cyclical. Sappi is a price taker, not a price maker – just like a mining company. Then you can layer on forex movements, potential manufacturing issues across a number of underlying facilities and of course the fair value adjustments to the forestry assets as well.

And even when Sappi manages to navigate the cyclical difficulties, they sometimes have to deal with a structural decline like we’ve seen in graphic papers.

Above all, it looks like the biggest current stress is the leverage ratio increasing to 3.2x, with a perfect storm of weaker performance and a heavy capex programme at Somerset Mill. Although the worst of the capex is behind them, they now have to claw their way out of the debt. Much as one may hope that the expansion at Somerset Mill will have an immediate positive impact on profitability, the reverse is unfortunately true – there will be a period of optimising and ramping up that project.

They do at least hope that adjusted EBITDA for the upcoming fourth quarter will be above that of the third quarter that they just reported on. Let’s see if they are right.

The Foschini Group’s share price is sliding again (JSE: TFG)

The market is unhappy about something here

The retail apparel sector has had a tough time this year. I recently switched out of my Sibanye-Stillwater position (leaving a small amount behind) and bought Mr Price (JSE: MRP), hoping for a recovery there as it strikes me as the baby thrown out with the bathwater this year. With a much more difficult portfolio that includes international exposure (and no plans to pull back from that), The Foschini Group strikes me as the bathwater itself.

The share prices are highly correlated, but I’m not convinced it will play out that way for the remainder of the year:

My thesis is strengthened by the market’s sharp negative reaction to the quarterly trading update from The Foschini Group, with the share price down 5.7%. On the same day, Mr Price was flat.

The first important point when looking at the trading update is that you need to exclude the acquisition of White Stuff in the UK. Like all acquisitions, the timing impacts comparability, as you have a business included in one period and not the other. On that basis, group comparable sales for the first quarter were up just 2.5% (in ZAR), while TFG London was down 2.6% in local currency. As for TFG Australia, sales were down 2.8% in local currency. Ouch.

As we’ve seen at rival Woolworths (JSE: WHL), the Beauty category is doing the heavy lifting at the moment. The Foschini Group’s sales in this category in TFG Africa grew by 24.5%, which is way higher than Clothing (4.2%) and Homeware (8.5%). Sadly, Beauty is just 3.2% of TFG Africa’s sales, so it’s much too small to offset slower growth elsewhere.

Store sales in TFG Africa increased by just 3.2%, while online sales were up 40.2% thanks to Bash. Online is now 7% of total TFG Africa sales, up from 5.2%. The omnichannel model is certainly working well.

Credit sales in TFG Africa increased by 9.3% to now contribute 28.2% of total TFG Africa sales. They aren’t explicit in the announcement, but some quick maths shows that cash sales must therefore have grown 3.7%.

The announcement is very light on details on TFG London, which doesn’t help when sales excluding White Stuff are down. They unfortunately don’t give online sales growth with an adjustment for White Stuff either, but we do know that online is 43.1% of TFG London sales. Sales growth excluding White Stuff was 6.3% for the three weeks to 19 July 2025, but I would be very nervous putting much faith on such a short period.

And in TFG Australia, there’s also little to hang your hat on – they blame the macro environment and its impact on consumers, along with the overall extent of promotional activity in the market that is hitting margins.

In addition to this update, the market has the Capital Markets Day presentations to chew on. It includes some great stats, like in the omnichannel deck where there’s a note that omnichannel customers spend up to 9x more without cannibalisation (i.e. of in-store sales), which improves share of wallet and customer retention.

I think this is the most worrying slide for me, showing White Stuff as being right in the middle of this quadrant that describes the competitive environment:

If you try and appeal to everyone, you appeal to no one. I’m certainly no retail exec, but “bridge market” just sounds like to me like a strategy that doesn’t know what it actually is. Zara is the most valuable name on that chart and they aren’t anywhere near the centre.

As for TFG Africa, apart from the deck including an incredibly odd map that talks about the “national footprint across South Africa” and then has pins only on the Western Cape, they’ve also put out an astonishingly ambitious 3-year CAGR for turnover of 12.9%. This would drive a 3-year CAGR for EBIT of 15.9%. I think the market would be pretty happy with even half of that, so that’s a huge target to make a public commitment to.

Time will tell!

Nibbles:

  • Director dealings:
    • An associate of a non-executive director of Glencore (JSE: GLN) bought shares worth around R330k.
  • Montauk Renewables (JSE: MKR) is an obscure name in the market, as the company is engaged in renewable energy projects in the US. There’s not much familiarity with the business among local investors and the company doesn’t really put in any effort to change that. So, I’ll just give the quarterly results a brief mention down here on an otherwise busy day of news from companies that you’ll recognise. For the quarter ended June 2025, Montauk increased revenue by 4.1%, but suffered a 27.7% drop in adjusted EBITDA. This was driven by a 22.4% decrease in pricing for the renewable fuel that they produce. The net loss for the quarter was $5.5 million, worse than $4.8 million in the comparable quarter in 2024.
  • An important milestone has been achieved in the Prime Kapital offer to shareholders of MAS (JSE: MSP). The SARB has approved the inward listing of the preference shares on the Cape Town Stock Exchange. This is a biggie, as it removes a concern around South African shareholders who might otherwise have needed to accept share-based settlement without a guarantee of the listing being approved. That uncertainty is now gone and investors can consider the preferences shares based on their merits rather than their potential existence.
  • Life Healthcare (JSE: LHC) has announced a special dividend of 235 cents per share from the proceeds of the disposal of Life Molecular Imaging. For context, the share price is around R13.60, so this is roughly 17% of the market cap.
  • Here’s your daily update on acceptances in the Primary Health Properties (JSE: PHP) offer to Assura (JSE: AHR) shareholders: with less than a week to go in the offer period, acceptances have been received by holders of 3.38% of shares.

UNLOCK THE STOCK: Capital Appreciation Ltd

The Finance Ghost
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UNLOCK THE STOCK: Capital Appreciation Ltd

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 59th edition of Unlock the Stock, Capital Appreciation returned to the platform to walk us through their recent performance and their growth areas going forwards. I co-hosted this event with Mark Tobin of Coffee Microcaps and the team from Keyter Rech Investor Solutions.

Watch the recording here:

PODCAST: No Ordinary Wednesday Ep106 – Beyond the balance sheet | Humanising wealth

Investec No Ordinary Wednesday
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PODCAST: No Ordinary Wednesday Ep106 – Beyond the balance sheet | Humanising wealth

Listen to the podcast here:

What do the colours of a popular toothpaste tell us about how we think about wealth?

In the latest episode of the No Ordinary Wednesday podcast, Alexandra Nortier and Marc Romberg, joint heads of Wealth Management at Investec Wealth & Investment International, join Jeremy Maggs to explore how the nature of wealth is changing.

Hosted by seasoned broadcaster, Jeremy Maggs, the No Ordinary Wednesday podcast unpacks the latest economic, business and political news in South Africa, with an all-star cast of investment and wealth managers, economists and financial planners from Investec. Listen in every second Wednesday for an in-depth look at what’s moving markets, shaping the economy, and changing the game for your wallet and your business.

This image has an empty alt attribute; its file name is Investec-banner.jpg

Also on Apple Podcasts, Spotify and YouTube:

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

Collins Property Group’s Netherlands subsidiary has concluded a series of inter-conditional agreements with Budé Beheer B.V. to acquire the property letting enterprises in respect of the associated properties of eight Do It Yourself stores (Gamma and Karwei franchise stores). The properties will continue to be tenanted by these franchise stores. The cash purchase consideration of €31,5 million may be adjusted upwards but is capped at €32,79 million.

In a deal which further expands its footprint in East Africa, ADvTECH has acquired Regis Runda Academy located northeast of Nairobi in Kenya. The academy, acquired for KSh1,23 billion (R172 million) will be rebranded as Makini Schools Runda.

Sirius Real Estate has acquired a further two business parks. The first, acquired for €23,4 million is in Dresden, Germany. Sirius plans to convert this into a multi-let industrial park. The second acquired for £16,13 million is a UK multi-let business park in Bedford, comprising warehouse, leisure, studio and office space.

Prime Kapital Investments (PKI) has launched its conditional voluntary bid to acquire those MAS plc shares not already held. The condition refers not to the acquisition of all outstanding MAS shares but rather to at least 10% of minorities accepting the offer of €1.40 per share. PKI has received SARB approval to list the consideration instruments on the CTSE. The offer period closes on 14 August 2025.

Prosus has led a US$4,17 million (R75 million) pre-Series A funding round in Arivihan, India’s first fully AI-based learning platform. The funds will be used to scale Arivihan’s go-to-market strategy and to building localised distribution networks in new geographies.

Deneb Investments has disposed of a property, considered non-core to its strategy, to Earth Instyle for a consideration of R48,5 million. The property situated at 195 Leicester Road, Mobeni in Durban was valued in the last company audited results for 31 March 2025 at R50,2 million. Proceeds will be applied to reducing debt.

To ensure compliance with the foreign control restrictions relating to the mandatory offer by Canal+, MultiChoice South Africa will be reorganised – details of this have now been announced. For an excellent explanation and analysis of a complex set of sequential inter-conditional transactions read Ghost’s summary here.

In its latest update, Primary Health Properties plc (PHP) says it has received valid acceptances for c.3.38% of Assura plc shares (110,278,589 shares) under the revised offer. Assura shareholders have until 12 August 2025 to accept the offer.

Unlisted Companies

Local travel fintech startup TurnStay has secured US$2 million in seed funding in a round led by First Circle Capital with participation from TLCom Capital, Enza Capital, Incisive Ventures, CVVC and Equitable Ventures. The funds will be used to expand its innovated stablecoin-based payment solution for Africa’s tourism sector. Tourism operators can accept card payments for international travellers in their local currencies while settling locally in stablecoins. This slashes transaction costs by as much as 70% and significantly accelerates the payout cycle, helping improve cash flow and reduce dependency on global travel platforms. TurnStay raised $300,000 pre-seed funding in July 2024.

Super app-as-a-service platform Flood has raised US$3,5 million in seed funding from venture capital firm CRE.vc and backed by angel investors. This follows a $1 million round in July last year. The platform which operates in SA, India and the Maldives will use the funds to expand into new emerging markets over the next few years. Flood’s value proposition for the digital commerce ecosystem in emerging markets is to onboard offline merchants to streamline financial inclusivity by partnering with telecos and banks to support this process.

Altera Biosciences, Africa’s dedicated cell and gene therapy biotech company, has successfully closed a R29 million pre-seed funding round. The investment, secured from venture capital firms including OneBio Venture Studio and E Squared Investments, will be used to further develop a universal donor cell platform.

Afriwise, a legal and regulatory intelligence platform for Africa, has acquired LawExplorer, a South African provider of regulatory monitoring and legislative tracking solutions. Financial details of the transaction were not disclosed.

IZI Group has completed its acquisition of G4S Cash Solutions (SA), following the receipt of all regulatory approvals. The deal was structured to ensure continuity for staff and suppliers and customers.

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

Life Healthcare (LHC) has declared a special cash dividend of 235 cents per ordinary share, payable from income reserves derived from the net proceeds received following the disposal of its interest in in Life Molecular Imaging. In January 2025, LHC announced the disposal to Lantheus Holdings in a deal valued at $750 million (R13,8 billion).

In terms of Sirius Real Estate’s dividend reinvestment plan (DRIP), shareholders on the UK share register holding 1,38% of the company’s issued share capital opted to receive shares in terms of the DRIP, resulting in the purchase of 540,336 shares in the market at an average price of £0.99 per share. Shareholders on the South African register holding 7.81% of the company’s issued share capital took up the DRIP option resulting in the purchase of 2,944,999 shares in the market at an average price of R24.85. The purchased shares represent a cash equivalent of €4,3 million.

Novus has acquired on the open market 22,355 Mustek shares at a price per share of R13.00. The shares were acquired outside of the Mandatory Offer for an aggregate value of R290,6 million.

In line with Glencore’s policy to maintain the number of treasury shares below 10% of the total issued share capital of the company, 50 million treasury shares have been cancelled. Following this, the total number of treasury shares held represents 9.57% of the company’s total issued share capital.

PK Investments has received SARB approval for consideration instruments to be listed on the CTSE. Following this approval, the listed consideration instruments will be issued to MAS plc shareholders electing to receive these instruments in respect of all or some (cash alternative) of their MAS shares.

This week the following companies announced the repurchase of shares:

Over the period 5 August 2024 to 5 August 2025, PBT Group repurchased 4,120,447 ordinary shares for an aggregate R23,37 million. The shares were acquired at an average price of R5.67 per share and will be cancelled and delisted. The company may repurchase a further 6,26 million shares representing 6.03% of the ordinary shares in issue.

iOCO will embark on a share repurchase programme to repurchase up to a maximum of 1,8 million of its ordinary shares. The programme commenced on 1 August and will be for a maximum of six months.

During the period 28 November 2024 to 31 July 2025, Datatec repurchased 4,147,205 shares on the open market for an aggregate R227,6 million. The shares were delisted on 6 August 2025.

Glencore plc’s current share buy-back programme plans to acquire shares of an aggregate value of up to US$1 billion. The shares will be repurchased on the LSE, BATS, Chi-X and Aquis exchanges and is expected to be completed in February 2026. This week 6,6 million shares were repurchased at an average price of £2.98 per share for an aggregate £19,47 million.

In May 2025 Tharisa plc announced it would undertake a repurchase programme of up to US$5 million. Shares have been trading at a significant discount, having been negatively impacted by the global commodity pricing environment, geo-political events and market volatility. Over the period 28 July to 1 August 2025, the company repurchased 17,743 shares at an average price of R21.44 on the JSE and 253,538 shares at 91.29 pence per share on the LSE.

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 being funded using the net proceeds of the block trade of shares in ITC to institutional investors. This week the company repurchased a further 578,159 shares at an average price of £41.41 per share for an aggregate £23,93 million.

During the period 28 July to 1 August 2025, Prosus repurchased a further 2,189,791 Prosus shares for an aggregate €110,08 million and Naspers, a further 139,626 Naspers shares for a total consideration of R792,8 million.

One company issued a profit warning this week: Metair Investments.

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

Rasaad Nigeria, a family-led agribusiness that aggregates high-quality cocoa and cashew nuts from over 1,000 smallholder farmers, has raised a US$590,000 loan facility from Sahel Capital’s Social Enterprise Fund for Agriculture in Africa fund.

Egyptian digital procurement platform Suplyd has raised US$2 million in a pre-Series A round led by 4DX Ventures, Camel Ventures, and Plus VC, with participation from Seedstars and existing investors. This funding will support the company’s mission to build a comprehensive infrastructure for restaurant operations and expand into untapped areas across Egypt.

Kasada, a leading pan-African hospitality investment platform, recently closed a €15 million debt facility provided by the Africa Go Green Fund, managed by Cygnum Capital. The facility will provide finance for a greenfield hospitality development in Abidjan, Côte d’Ivoire. The project, which will be in the Angré district, will feature a hotel with a total of 170 keys, co-working facilities under the Wojo brand, and a dedicated MICE (Meetings, Incentives, Conferences, and Exhibitions) venue. The hotel is expected to attract regional business traffic, including from Small and Medium Enterprises located in the area, while introducing Angré’s first EDGE-certified hotel.

The International Finance Corporation and Sony Innovation Fund have announced an investment into Nigeria-based Filmmakers Mart (FMM), Africa’s first integrated digital production platform, to enhance access to production services in Africa’s film and entertainment industry. The investment will support FMM expansion from its current markets in Nigeria, Kenya, Ghana, Morocco and South Africa into new markets. It will also fund the development of new platform features, including subscription models, post-production tools, and training programs designed to serve a growing community of creators.

Egypt-based Saas provider Wuilt has raised US$2 million in a funding round led by follow-on investment from Flat6Labs and MTF VC, with participation from Hub71, JIMCO, Purity Tech, and a group of other angel investors. With the new capital, Wuilt plans to launch its free platform in the UAE in Q4 2025, followed by GCC countries and Turkey in Q1 2026. This comes after Wuilt’s April 2025 announcement it would offer its core platform completely free in Egypt, eliminating all subscription fees and forgoing hundreds of thousands of dollars in annual recurring revenue in a move to accelerate merchant adoption. Since then, over 20,000 merchants have joined the platform.

Mediterrania Capital Partners has announced an investment in Dislog Dispositifs Médicaux (DDM) through a DM 540 million capital increase together with CDG Invest Growth. This fund-raising – the largest in Dislog’s history –marks a decisive turning point in the development of its healthcare division. Morocco’s healthcare sector is set to accelerate its growth, driven by increasing investments and untapped potential in healthcare spending and infrastructure. The sector thrives on population growth, rising GDP, and expanding medical coverage, setting the stage to realise its full potential.

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

Ghost Bites (Astoria | Collins Property | Glencore | Jubilee Metals | Quilter | Sirius Real Estate)

The Finance Ghost
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Ghost Bites (Astoria | Collins Property | Glencore | Jubilee Metals | Quilter | Sirius Real Estate)

The Trans Hex write-down has hurt Astoria (JSE: ARA)

The rest is a mixed bag at the moment

Investment holding company Astoria is one of the victims of lab-grown diamond disruption. The group has fully written down the value of the investment in Trans Hex and Marine Diamond Operations, which were collectively valued at R72 million as at the end of December 2024. That’s around 10% of the NAV at that date, so it hurts. The silver lining is that the management team has chosen to rather walk away from giving further support to this asset vs. the alternative of throwing good money after bad.

With the NAV down 9.1% from December 2024 to June 2025, the diamond write-down explains the negative move. The rest of the portfolio has some ups (like Leatt and Goldrush) and downs (Outdoor Investment Holdings).

The largest asset by far is Outdoor Investment Holdings, in which Astoria has a 40.2% stake. It now represents over 60% of the NAV thanks to the disappearance of the diamond values. Recent turnover growth has been modest and margins have taken a knock, leading to a 4% decline in the value of that stake.

After the investment in Leatt (R84.7 million), the third largest asset is now cash and receivables (R63.1 million) thanks to the disposal of the stake in ISA Carstens. This means that nearly 10% of the NAV is in cash.

Speaking of the NAV, Astoria’s NAV per share is R10.65 and the share price is R7.90.

Collins Property does it themselves in the Netherlands (JSE: CPP)

They’ve bought a substantial portfolio of properties with DIY tenants

Collins Property Group has taken the route that a number of other South Africans have taken in the past few years: looking for opportunities in the Netherlands. Perhaps they really like the colour orange, or Max Verstappen. I suspect that above all else, they like earning euros.

Collins (part of the broader Christo Wiese stable, as you may recall) is acquiring a portfolio of 8 properties for €31.5 million. Adjustments might take the price as high as €32.8 million. The tenants are DIY stores that are being sold to a new owner, so Collins is swooping in and doing the property leg of the deal.

Although this does introduce the risk of the tenants being under new ownership, Collins would’ve done their homework here. They’ve already got exposure in the country, which would’ve assisted with the due diligence. The leases are also structured as triple net leases, which means there is low variability of expected income – provided that the tenants pay, of course.

But now for the most important part: the acquisition yield. Based on the forecast net profit attributable to the properties, the yield after tax is expected to be 3.3%. You can’t compare this directly to net initial yields on most property acquisitions, which are before tax. I’m not sure why Collins doesn’t disclose net initial yield in line with market practice. I’m also not sure why they don’t indicate the level of debt associated with the deal and whether that is impacting the expected profit after tax.

Collins currently trades on a dividend yield of 8.7%, so this transaction will be dilutive to that yield. Will South African investors give enough credit to offshore exposure? Or does Collins even care? There’s an argument that because the shares are tightly held, the underlying exposure is managed in such a way that mainly suits the anchor shareholders.

Glencore hopes for a better second half in copper (JSE: GLN)

And either way, there’s a self-help strategy around costs

Glencore has released its financials for the six months to June. They had a rough time, with flat revenue and a 14% drop in adjusted EBITDA. There’s once again a net loss that shareholders need to stomach, except this time its gone up from $233 million to $655 million.

Before you panic, the loss isn’t an indication of cash flows. They generated $3.15 billion in funds from operations. Still, that’s 22% lower than the prior year. There are a bunch of other moving parts on the balance sheet, including the receipt of proceeds from the sale of Viterra. If you include those proceeds (received just after period-end on 2 July), then net debt to adjusted EBITDA is at 1x. So, the balance sheet is healthy, hence why Glencore is able to press on with share buybacks while the share price is at depressed levels.

The problems in the first half of the year were mainly thanks to lower coal prices and a drop in copper production. There’s nothing that they can do about the former. In terms of the latter, Glencore is looking ahead to a much better expected copper output in the second half of the year. They are also looking at $1 billion in recurring cost savings (measuring vs. 2024 as a baseline), which they expect to fully deliver by 2026. They plan to be 50% through the savings by the end of 2025.

There’s a lot riding on the second half of the year, with Glencore’s share price down 19% year-to-date.

Jubilee Metals updated the market on its copper business (JSE: JBL)

And with plans to sell everything else, this is the important bit

Jubilee Metals has a few irons in the fire when it comes to copper in Zambia. They have their mine-to-metals business, which is the Sable refinery combined with nearby copper mines. They also have the Roan concentrator, which processes third-party copper feedstock. Finally, they can process surface stockpiles and tailings that they’ve been acquiring.

The Roan concentrator has had a lot of focus recently, with an upgrade that is now fully operational and exceeding targeted monthly production. That’s just as well, as production in the first half of the year was severely impacted by power and infrastructure issues. It was so bad that Roan was placed under care and maintenance!

The open-pit mining is much earlier in the process, with Jubilee undertaking drilling work. As for the tailings, Jubilee is trying to prioritise its capital spending by selling the tailings that it considers non-core. They are also looking to dispose of their chrome and PGM operations in South Africa, with a circular expected to be distributed this week for that deal.

Jubilee only managed to produce 2,211 tonnes of copper units in FY25. Their guidance for FY26 is 5,100 tonnes, so that will be a massive recovery if they can get it right. They have little choice, as they’ve thrown everything behind the Zambian copper strategy. The share price is down 18.6% year-to-date.

A juicy jump in the dividend at Quilter (JSE: QLT)

The increase in earnings is more modest

Quilter has released results for the six months to June 2025. This has been a strong performer on the JSE, with a wealth and asset management business model that enjoys powerful distribution in the UK. The share price is up 23% over 12 months and 10% on a year-to-date basis.

The key metric is net inflows, with the distribution part of the business doing its job. Assets under management and administration (AuMA) enjoyed core net inflows equal to an annualised 8% of the opening value. That’s a very strong driver of earnings that makes the company less reliant on overall market values in the portfolios. AuMA increased by 6% from December 2024 to June 2025.

Profit growth was modest, with adjusted profit before tax up 3% and operating margin increasing by just 100 basis points to 30%. This is because revenue was only up 2%, so they found it harder to drive revenue despite the uptick in assets. A dip in interest revenue was also a contributor here.

This didn’t stop Quilter from pushing the dividend a lot higher, with an increase of 18% to 2.0 pence per share (it’s a UK company).

Sirius Real Estate announces more acquisitions in Germany and the UK (JSE: SRE)

They don’t waste time when it comes to deploying capital

When listed property funds raise capital from the market for general acquisition purposes, the risk to shareholders is that the fund sits on the capital rather than deploying it. This leads to a cash drag effect that hurts returns. With the inclusion of these latest acquisitions, Sirius Real Estate has managed to do €165 million worth of acquisitions in 2025. They are certainly doing their best to avoid the cash drag trap!

The latest deals include a business park in Germany for €23.4 million and one in the UK for £16 million. Both are off-market deals, which means Sirius avoided being part of a bidding war. When you’re a regular acquirer of assets, you get access to the best deals before the general market does. In the area in Germany where the latest property is located, Sirius already has three other properties. This is the value of building relationships through focusing on specific regions. Interestingly, this region in Germany (called Dresden) is attracting investment from semiconductor companies like TSMC, so that has incredible knock-on benefits for the broader area.

As usual with Sirius, there are plans afoot to improve the yield on the properties. The site in Germany currently has one tenant (being the seller of the property) who will vacate after a year. At that stage, Sirius will convert the property to a multi-let business park. The site currently generates a net initial yield of 9.13%.

The property in the UK is already a multi-let park and offers a net initial yield of 9.52%. 36% of tenants are in the defence sector, so that seems like a clever play in Europe at the moment. 67% of tenants have “lease events” within the next two years, which is an opportunity for an uptick in rates on the leases. Although Sirius notes that Bedford is the site for a proposed Universal theme park that would bring benefits to the area, I’m not sure the defence tenants care too much!

Separately, Sirius sold off a small property in the UK for £1.55 million, which is a 7% premium to the most recent book value. Even on small sales, achieving a premium to book is what helps give support to the Sirius valuation.

Nibbles:

  • Director dealings:
    • A director of Richemont (JSE: CFR) sold shares worth around R73 million. In a separate announcement, a director sold shares worth nearly R30 million. As the primary listing is in Switzerland, famous for helping rich people keep things a secret, we don’t know which directors sold shares.
    • Absolutely zero marks to Raubex (JSE: RBX) for the disclosure around directors and execs selling shares from the long-term incentive scheme. No effort is made to indicate the taxable vs. non-taxable portions. On sales of over R17 million, that’s a frustrating lack of useful information for shareholders.
    • The director of Santova (JSE: SNV) who has recently been selling shares is at it again, offloading shares worth R4.1 million.
    • The CEO of Vunani (JSE: VUN) is picking up whatever shares he can get his hands on in the market, with the latest purchase being for R2.7k.
  • Spear REIT (JSE: SEA) announced the acquisition of Berg Business Park in Paarl back in May. The company has confirmed that the deal has now met all conditions and that transfer is expected to take place in October.
  • The latest acceptance level for the Primary Health Properties (JSE: PHP) offer to Assura (JSE: AHR) shareholders shows that holders of 3.13% of shares have accepted the offer. The closing date is 12 August.
  • The mess that is aReit (JSE: APO) continues. The latest issue is that the auditors have resigned because they don’t have access to the resources required for timeous release of financials. Specifically, aReit is stuck because they can’t get outstanding financial information from third parties associated with their tenants. The company is suspended from trading. It turns out that I wasn’t wrong about the bright red flag of the company releasing its initial listing docs without even having a finalised website.
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