Naspers out to prove it is not a one trick pony – FT
Naspers CEO Bob van Dijk says Naspers has proven that the company can turn businesses into large multi-billion-dollar operations and that it is the epitome of a 21st century e-commerce business as the JSE darling prepares to spread its wings to Europe. Naspers was looking for the best option to address the share price gap and knew it was frustrating for all its stakeholders. – Linda van Tilburg
By Thulasizwe Sithole
When you look at Naspers' decision to invest in Chinese company, Tencent, it is regarded as one of the big winners in the investing hall of fame. The $32m investment in 2001 has grown to $133bn. It resembles the bet of $20m that the founder of Softbank, Masayoshi Son took in 2000 on Alibaba, the Chinese e-commerce giant. Alibaba is now worth close to $132bn and Softbank has become one of the "most powerful investors in the world."
While Naspers is the largest company in Africa by market capitalisation, its valuation is just $100bn, which is "more than $30bn short of the value of its Tencent stake." The reason for the valuation gap of $30bn is due to the "overwhelming dominance of its Chinese investment." This gap has overshadowed other parts of the Naspers empire including Latin America's food delivery apps, online payment groups in India, social networking outfits in Russia and Naspers' venture to establish the equivalent of Amazon in South Africa. Tencent has been described by a former chairman of the group as "the big, winged stallion in Naspers' stable. "
Naspers has also loomed large over the Johannesburg Stock Market in the last ten years, "propping it up as Jacob Zuma's presidency trashed the economy and corruption scandals scared off foreign investors." The Financial Times says the company has become too big for the JSE and is on the brink of a major corporate transformation as it is ready to list a separate company, Prosus on the Amsterdam bourse which would including 25% of its Tencent stake and its global internet assets. At its listing, it will become Europe's largest consumer internet company, ahead of Spotify.
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