Fairvest invests deeper in township fibre (JSE: FTA)

This may sound very random for a REIT, but there’s a yield and an upliftment of areas in which Fairvest has properties

Fairvest has previously invested around R477 million in Onepath, a subsidiary of Fairvest that acquires fibre network infrastructure in townships and leases it to Fibertime Networks (US spelling for some reason). The claim to fame is that households can be connected on a pay-as-you-go model for just R5 a day, which is fantastic.

But why would a REIT do this? Well, there are two main reasons.

The first is that the investment actually generates returns, in this case an annualised yield of 14.9% from November 2024 to September 2025. There’s certainly nothing wrong with that, particularly as these are triple-net leases that put all the insurance and maintenance costs on Fibertime.

The second is that it gives Fairvest useful information about these communities, which in turn informs their decisions around township-adjacent retail properties. This is an important growth area in South Africa.

To further the strategy, they’ve committed to invest up to R1 billion in aggregate in Onepath i.e. they are roughly halfway there.

Personally, I think anything that brings connectivity to marginalised communities should be celebrated, especially if the financial returns also stack up.

Mantengu has commissioned Langpan’s second chrome processing plant (JSE: MTU)

This is good news to cap off the year

Mantengu’s share price hasn’t yet recovered from the nasty drop in response to the recent set of financials. The company has lots of work to do, but there’s some good news around Langpan to help improve the financial prospects of the company.

Mantengu has successfully commissioned the second chrome processing plant at Langpan Mining. Langpan has 300,000 tonnes of tailings that will be fed into the new plant, giving them roughly 10 months of feed to work with. It looks like the proceeds from processing this feed will then be used to ramp up mining operations, as they need to get to 60,000 tonnes per month of chrome ore feed in order to sustain two processing plants.

There’s a PGM strategy in here as well, as the tailings contain PGMs that haven’t been recognised on the balance sheet as of yet. The company has promised to give a subsequent update to the market regarding the PGM strategy.

Premier Group and RFG Holdings shareholders approve their deal (JSE: PMR | JSE: RFG)

Approval at both meetings was unanimous

In a week in which Mr Price (JSE: MRP) showed us what a truly daft deal looks like, it’s worth reflecting on whether Premier Group and RFG Holdings are doing the right thing with their deal. As a reminder, Premier is acquiring RFG, but in reality it’s closer in spirit to a merger.

The market is comfortable with the transaction, as shown by the two share prices over the past few months:

For the sheer contrast of it, here’s what it looks like when the market is angry at a deal:

So, people aren’t overly worried about Premier’s acquisition of RFG Holdings. In fact, there’s bullish sentiment around it. I remain skeptical, as it’s not obvious to me that this deal is based on sensible underlying reasons for the companies to belong together. We have a private equity seller on one side and an acquirer on the other who can take advantage of relative earnings multiples to achieve an accretive deal. Accretive HEPS in the near-term doesn’t necessarily mean that the strategic fit over the next few years will work out as well as they hope.

Time will tell. The FMCG market is notorious for questionable deals. I hope we won’t see a situation where the combined group trades at a structurally lower multiple than before due to more erratic earnings and the difficulties investors will face in forecasting earnings. JSE investors are rewarding simplicity at the moment, not complexity.

Nibbles:

• Director dealings:
  • A2 Investment Partners bought another R55 million worth of shares in Nampak (JSE: NPK). It comes through as a director dealing because they have representation on the board.
  • Adrian Gore sold Discovery (JSE: DSY) shares worth R50 million. He also entered into a put-call hedging structure, with puts at R229.28 and calls at R374.87. The current spot price is R227, so he’s protecting downside risk from these levels. The value of the hedge based on the put strike is a meaty R365 million.
  • Here’s a big disposal: a prescribed officer of Dis-Chem (JSE: DCP) – specifically Christopher Williams on the wholesale CJ Distribution side – sold shares worth R35 million. I’m glad they didn’t try to soften the messaging by talking about some kind of rebalancing.
  • The CFO of Lewis Group (JSE: LEW) sold shares worth over R1.3 million. The ol’ “portfolio rebalancing” rationale has struck again. A sale is a sale!
  • Acting through Titan Premier Investments, Christo Wiese bought shares in Brait (JSE: BAT) worth R608k.
  • The company secretary of Bidvest (JSE: BVT) sold shares worth R323k. Although the sale relates to a share price appreciation rights plan, the announcement isn’t explicit on whether this is only a taxable portion. I therefore assume that it isn’t.
  • Two directors of Spear REIT (JSE: SEA) bought shares worth R254k in aggregate.
  • A director of Afrimat (JSE: AFT) bought shares worth R84k.
  • The CEO of Vunani (JSE: VUN) bought shares worth R43k.

• Astral Foods (JSE: ARL) announced the appointment of Johan Geel as CFO with effect from 1 March 2026. He will replace Dries Ferreira who has resigned as CFO. Johan’s most recent role was CFO at AFGRI Limited, so he has plenty of experience in the agriculture sector.

• KAP (JSE: KAP) has implemented the category 2 disposal of Unitrans Swazi Holdings with an effective date of 1 December.

• Supermarket Income REIT (JSE: SRI) confirmed that Fitch has reaffirmed the company’s existing investment grade rating on the debt (BBB+ with a stable outlook). For property companies, debt is part of their business model and so these ratings are critical.

• The Conduit Capital (JSE: CND) mess is finally coming to an end, at least in the listed space. Having been suspended from trading for three years and with no meaningful ability to rectify the situation while they pursue various court processes, it’s time for this one to go. The JSE will delist the company on 19 December. If you’re unlucky enough to be stuck with shares in this thing, they will now be in an unlisted company.