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Tiso Blackstar's media assets sold to Lebashe Investment Group

Jun 27 2019 18:32
Carin Smith and Marelise van der Merwe, Fin24

Tiso Blackstar has signed an agreement to sell its South African media, broadcasting and content businesses to Lebashe Investment Group for R800m subject to certain adjustments.

The sale would exclude Gallo and its South African radio assets.

Tiso Blackstar owns publications including the Sunday Times, Business Day and Financial Mail. 

In a Stock Exchange News Service (SENS) notice on Thursday evening, Tiso said it had also reached an agreement on the terms upon which it will sell its media, broadcasting and content businesses in Ghana, Nigeria and Kenya, plus its South African radio assets to Lebashe, for an additional R250m.

The total transaction will come to just over R1bn.

Lebashe has former deputy finance minister Jabu Moleketi as one of its non-executive directors. Moleketi is also a former chairperson of the Public Investment Corporation (PIC).

Lebashe's chair is Tshepo Mahloele, who is also Chief Executive Officer of Harith General Partners. Mahloele was one of the originators of the US$630M Pan African Infrastructure Development Fund, and previously headed the Corporate Finance and Isibaya Fund divisions of the PIC. 

Restructuring

According to the Tiso statement, the transaction will require an internal restructuring of the group of companies of which it is the ultimate holding company into entities that can be sold to Lebashe.

The purchase price of the SA sale will be "adjusted for debt, cash and normalised working capital, and for any movement in tangible net asset value".

According to the statement, the board of directors of Tiso believe the transaction is in line with its strategy and the sale will unlock significant value for shareholders, while also ensuring that the media business has a strong and committed shareholder in Lebashe to take it forward.

"The transaction will allow Tiso Blackstar to focus on its remaining businesses and investments, specifically the Hirt & Carter operation which has grown significantly in recent years and operates in a unique market segment," the statement said.

"It will retain the Gallo Music Group business and develop it further as the music industry continues to evolve. The company remains committed to ensuring it unlocks value in its Kagiso Tiso Holdings stake in the short to medium term."

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