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Happy hour at Distell?

Stellenbosch-based liquor group Distell Group [JSE:DST] is a great company – with astute management, a diverse range of best-selling brands, strong cash flows (with rand hedge qualities) and a propensity to pour out stiff dividends on a regular basis. But Distell’s big drawback is it isn’t the most liquid stock on the JSE, with almost 90% of its issued shares locked up in the Remgro/CapVin and SABMiller arrangement.

Were it not for that scarcity of stock, Distell would be perfect fodder for institutional shareholders – especially those asset managers who look for a mix of growth and yield.

But perhaps there are a handful of reasons for some Easter cheer. Our directors’ dealings table this week shows two Distell executives selling off a whack of shares – scrip that would no doubt have been gratefully scooped up by long-parched market participants.

In the previous week, Finweek also noticed two Distell directors (plus Remgro [JSE:REM] director Emile Bührmann) selling off a few shares. While the previous directors’ dealings involved less than 10 000 shares in Distell, last week’s transaction by company secretary Stoffel Cronjé and sales director Nantha Moodley involved a more substantial transaction of more than 70 000 shares worth R5,2m.

Maybe they’ll even set a trend?

Now, we wonder, who might have picked up the shares so kindly put into the market by those Distell directors? Hopefully, a clever institutional shareholder or a few smart small investors tapped in – although we can’t discount the chances of major shareholders fortifying their positions.

We doubt Zeder Investments [JSE:ZED] – which recently gave up KWV – would want to directly top up its Distell holding, which is mainly stored away in unlisted CapeVin Holdings.
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