Wednesday 16 February 2022
Things at Oceana are starting to smell like a rotten fish that has been lying in the sun for a week. After the results of the legal investigation into the company's accounting were downplayed by the company, we've seen the CFO leave the building and now the CEO and another executive director as well. Very few details are being provided by the company in the SENS announcements. The share price finally took a knock in response to all this, down 4.6% yesterday. A replacement CEO has been announced in the form of Neville Brink, who has been with the group since 1995. At this stage, the market is just looking for answers on what is actually going on.
The Steinhoff settlement process kicked off yesterday, which means that eye-watering amounts of money changed hands. This puts Steinhoff's previous issues to bed once and for all. The group will now need to focus on improving its balance sheet and driving its operations. There is very little room for error, as the group is still carrying a lot of debt.
Distell has successfully cleared the first hurdle in the deal process. The various resolutions under the scheme of arrangement for the Heineken deal were approved at a scheme meeting held yesterday. There's still a long way to go in the process and interested parties should refer to the deal circular for the full transaction timetable. The great unknown is the Competition Commission, with that process to be followed in coming months.
Discovery has announced a new initiative called Amplify Health, a Pan-Asian health InsurTech business in partnership with AIA Group, a market-leading insurance group in Asia. If it has Tech in the name, it must be exciting right? In this case, Pan-Asian means Asia excluding China, Hong Kong and Macau, as Discovery already has an exclusive relationship in those countries with Ping An Health Insurance.
Long story short: Discovery's Vitality and other innovations will be used in this joint venture through a working relationship that Discovery calls the "Shared-Value Insurance" model. It's a clever model as it lets Discovery monetise the intellectual property it has already developed, while tapping into markets that would otherwise be difficult to access.
Discovery will hold a 25% stake in the joint venture and will earn additional income for the assignment of IP ownership and transfer of expertise. Jonathan Broomberg, former CEO of Discovery Health and current CEO of Vitality Health International, will be the founding CEO of Amplify Health. Despite all this happy news, the share price only closed 1.6% higher on the day.
Reunert will be moving ahead with the restructure of its B-BBEE ownership and the establishment of an employee share ownership programme. The various resolutions required for the deals were passed at a gen eral meeting held yesterday.
Zeder shareholders need to check their emails, as the circular for the disposal of The Logistics Group has been sent out. The meeting to vote on the transaction will be held on 15 March.
Finally, make sure you listen to Episode 62 of
Magic Markets. This was a favourite of mine, as we tapped into the brilliant mind of
Afrimat CEO Andries van Heerden. Afrimat has a formidable track record on the JSE, which is especially impressive as it has been achieved in the mining sector which is one of the hardest places to play.
Find out the secrets to success here.
Have a wonderful Wednesday!
The Finance Ghost
