Mvelaserve to be listed

Johannesburg – Empowerment investment holding company Mvelaphanda Group [JSE:MCG] is on course to separately list its sole operating entity and largest revenue contributor Mvelaserve.

"The board has considered the best way to extract value of out of Mvelaserve and decided the best way forward would be a listing on the JSE," said Mvela Group CEO Yolanda Cuba on Thursday.

Cuba could not commit to a listing date. "Market conditions will dictate that," she said. "We have demonstrated with the listing of Life Healthcare that we can extract maximum value efficiently and when the time is right we will do so with Mvelaserve."

The company has however not ruled out other possibilities, such as a sale of Mvelaserve should a suitor come knocking with the correct price. "The board of Mvela Group is in the process of assessing both the qualitative and quantitative aspects of alternatives available."

Mvelaserve increased it revenue from operations in the year to end-June by 17% to R4.1bn (R3.56bn in 2009). Mvela's group revenue was R4.2bn in the year.

Mvela said the intrinsic net asset value per Mvelaserve share increased to 370 cents. That indicated Mvela would be eyeing north of R2bn for the asset.

With a possible listing of Mvelaserve, the group would have managed to spin off more than 70% of its original assets, as it has already separately listed hospital group Life Healthcare Group Holding [JSE:LHG].

The remaining major assets would be its effective 10% stake in Absa Group. The stake is held by Mvela subsidiary Batho Bonke. The lock-in period on the Absa shares expires in March 2011, and Cuba said the parties "continually engage as partners" to find the best way forward. Cuba wouldn't elaborate on what "engagement" with Absa entails. "The main consideration would be to achieve long-term interests for both parties," said Cuba.

Asked what would remain in Mvela Group and whether it can still maintain its listing status when it disposes of Mvelaserve, Cuba said the company is in discussions with the JSE about moving to the "Investment Instruments" section of the bourse to maintain its listing without an operating asset or controlling share in any investment.  

A successful unbundling or sale of Mvelaserve would then free Cuba to consider her association with Mvela, as she has previously committed to restructuring 70% of the group's assets before making a personal move. "I have not yet arrived at that stage and will consider things when I get over the business at hand," said Cuba.

 - Fin24.com