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Steep (l)earning curve
THE SHARE PRICE shifts for PSG Group [JSE:PSG] ’s new private education venture Curro Holdings have been quite amazing – especially in this dull market. The last time TheSPECtacle experienced such a jump in education was when he “took six” from the headmaster for some inappropriate doodling in his Standard Seven poetry book. By busting through the 1000c level last week, Curro carried a market capitalisation of almost R900m ahead of a R322m rights issue.
While some old market hands were shaking their heads in disbelief, the surging Curro share price is a simple function of supply and demand. (Whether it would be better to buy AdvTech – the JSE’s other private education listing – is a debate for another time.)
There’s obviously a shortage of Curro scrip, because main shareholder PSG (Paladin, to be precise) is certainly not a seller. With many pundits believing Curro is PSG’s “next Capitec” there’s a fair bit of demand to buy in ahead of the one-for-one rights issue. Considering a rights price of 400c, the market is factoring in a post-issue share price of roughly 700c for Curro, which was probably at the upper end of PSG’s expectations at the time of listing.
TheSPECtacle wonders whether the initial froth will blow off and if Curro – which isn’t going to be generating meaningful profits for quite a while – will settle down at more reasonable levels.
The money’s talking
THERE’S NOT a hell of a lot of market interest in Dialogue Group Holdings [JSE:DLG] these days. It now holds the status of a cash shell after disposing of its call centre service operations. But there may well be a few more punters sniffing around Dialogue following an announcement that Tantalum Capital had bumped up its stake in the company from 9,65% to 10,1%.
Tantalum is a Cape Town-based investment boutique headed by Rob Oellerman, Morné Marais and Richard Kommel – all smart guys who previously served with Coronation Fund Managers. Now why would Tantalum be upping its stake in a cash shell?
Well, perhaps buying shares at 11c is a great tactic if the market turns bearish in the second half – especially considering Dialogue’s last stated net asset value (after a 12c/share special payout) was somewhere close to the 18c/share mark.
More intriguing – although probably unlikely – would be if Tantalum were looking at reversing either its company or a specialist fund into the Dialogue shell.
Something to think about, anyway…
Naming and shaming
COLLECTIONS MUST BE very hard for furniture retailer EllerineS to prompt the company to “name and shame” its non-paying customers. In a visit to one of its branches in Johannesburg, TheSPECtacle saw around five ID copies of people plastered on the wall behind a cashier’s counter. On enquiry, the cashier – without hesitation – said those were ID copies of customers labelled with a code name FID, which she understood to be an acronym for “First Instalment Due”. She added: “It’s a company policy.”
With Abil – the owners of Ellerines – having recently reported a 30% rise in headline earnings in its retail business, isn’t it a bit startling Ellerines would go to such extremes trying to recover debt? Maybe it’s the policy that’s ensured Ellerines’ turnaround.
The quantum of solace
WITH A MARKET capitalisation that’s dribbled down to R50m, a restraint of trade payment of R40m (in cash and shares) to former directors of Quantum Property Group [JSE:QPG] (QPG) stands out like a sore thumb in its latest half-year to end-February results. The former directors played key roles in developing Quantum’s 15-on-Orange development in Cape Town (see report, page 31), which suffered some serious cost overruns and is currently battling to service its accumulated debt.
Under the circumstances some shareholders may well question the restraint of trade payments – perhaps even urge current directors to dig a little deeper into the matter with a view to recovering monies.
THE SHARE PRICE shifts for PSG Group [JSE:PSG] ’s new private education venture Curro Holdings have been quite amazing – especially in this dull market. The last time TheSPECtacle experienced such a jump in education was when he “took six” from the headmaster for some inappropriate doodling in his Standard Seven poetry book. By busting through the 1000c level last week, Curro carried a market capitalisation of almost R900m ahead of a R322m rights issue.
While some old market hands were shaking their heads in disbelief, the surging Curro share price is a simple function of supply and demand. (Whether it would be better to buy AdvTech – the JSE’s other private education listing – is a debate for another time.)
There’s obviously a shortage of Curro scrip, because main shareholder PSG (Paladin, to be precise) is certainly not a seller. With many pundits believing Curro is PSG’s “next Capitec” there’s a fair bit of demand to buy in ahead of the one-for-one rights issue. Considering a rights price of 400c, the market is factoring in a post-issue share price of roughly 700c for Curro, which was probably at the upper end of PSG’s expectations at the time of listing.
TheSPECtacle wonders whether the initial froth will blow off and if Curro – which isn’t going to be generating meaningful profits for quite a while – will settle down at more reasonable levels.
The money’s talking
THERE’S NOT a hell of a lot of market interest in Dialogue Group Holdings [JSE:DLG] these days. It now holds the status of a cash shell after disposing of its call centre service operations. But there may well be a few more punters sniffing around Dialogue following an announcement that Tantalum Capital had bumped up its stake in the company from 9,65% to 10,1%.
Tantalum is a Cape Town-based investment boutique headed by Rob Oellerman, Morné Marais and Richard Kommel – all smart guys who previously served with Coronation Fund Managers. Now why would Tantalum be upping its stake in a cash shell?
Well, perhaps buying shares at 11c is a great tactic if the market turns bearish in the second half – especially considering Dialogue’s last stated net asset value (after a 12c/share special payout) was somewhere close to the 18c/share mark.
More intriguing – although probably unlikely – would be if Tantalum were looking at reversing either its company or a specialist fund into the Dialogue shell.
Something to think about, anyway…
Naming and shaming
COLLECTIONS MUST BE very hard for furniture retailer EllerineS to prompt the company to “name and shame” its non-paying customers. In a visit to one of its branches in Johannesburg, TheSPECtacle saw around five ID copies of people plastered on the wall behind a cashier’s counter. On enquiry, the cashier – without hesitation – said those were ID copies of customers labelled with a code name FID, which she understood to be an acronym for “First Instalment Due”. She added: “It’s a company policy.”
With Abil – the owners of Ellerines – having recently reported a 30% rise in headline earnings in its retail business, isn’t it a bit startling Ellerines would go to such extremes trying to recover debt? Maybe it’s the policy that’s ensured Ellerines’ turnaround.
The quantum of solace
WITH A MARKET capitalisation that’s dribbled down to R50m, a restraint of trade payment of R40m (in cash and shares) to former directors of Quantum Property Group [JSE:QPG] (QPG) stands out like a sore thumb in its latest half-year to end-February results. The former directors played key roles in developing Quantum’s 15-on-Orange development in Cape Town (see report, page 31), which suffered some serious cost overruns and is currently battling to service its accumulated debt.
Under the circumstances some shareholders may well question the restraint of trade payments – perhaps even urge current directors to dig a little deeper into the matter with a view to recovering monies.
