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Cape Town - The Black Business Council (BBC) has concluded a transaction to buy 6 million shares in Sagarmatha Technologies, the holding company which aims to corral the assets of the media empire of newspaper baron Iqbal Survé, calling it an "industry leader of choice".
In a media release on Tuesday, the BBC said that the 6 million shares were valued at R240m.
"This is certainly a noteworthy accomplishment as we have not just invested in a black business, but strategically positioned ourselves favourably on a growth trajectory of the ICT sector with the industry leader of choice," it said.
The business lobby group also hit out at what it said were "sustained attacks from detractors" around the feasibility of the holding company.
Sagarmatha was initially scheduled to list on the local bourse last week Friday. The date was twice postponed, and the group now intends to list on Friday April 13.
Before listing Sagarmatha wants to finalise the private placement of 189 million of its 1.2 billion shares with invited investors. Through this placement, the group hopes to raise up to R7.5bn and create buzz ahead of its main listing on the JSE.
About R1bn of this capital would be used to pay off debt. The placement shares have been valued at R39.62 each, which means the group’s 1.2 billion shares will give it a market capitalisation of R49.7bn if they hold their price and are all bought.
This would just about put the group in the top 40 by valuation on the JSE.
Sagarmatha’s current major assets include majority stakes in news wire agency ANA, e-commerce retailer Loot, IOL Property and online news site IOL. It has previously said that by the time it lists on the local bourse, it would also have acquired 100% of the shares of holding company Sekunjalo Independent Media, or SIM, which in turn holds a 55% interest in newspaper publisher Independent Media, owner of the Cape Times, the Star and other newspapers.
'Concerted attack'
The BBC said that articles in non-Independent Media publications questioning the valuation of the new firm and the debt it would take on, were "concerted attacks against a black owned business".
The Cape Times, which falls in the Sekunjalo Independent Media group, on Tuesday lead with an article extolling the company, saying the listing "has been widely lauded by its investors which include black empowerment groups".
As Fin24 previously reported, Sekunjalo Independent media is in a challenging financial position.
According to the 201-page pre-listing statement, as of June 30 2017 it had accumulated losses of R752m, while the company’s total liabilities exceeded its assets by R547m.
“The ability of the company to continue as a going concern is dependent on a number of factors. The most significant of these is that the directors continue to procure funding for the ongoing operations for the company," the pre-listing stated.
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