Tiso Blackstar says the reduction of its investments in the past year no longer makes it viable to be listed on the JSE.The former Sunday Times owner is now looking to sell its stake in Kagiso Tiso Holdings.The company said the JSE listing never provided sufficient liquidity.It has proposed a repurchase of its shares from shareholders.
The one-time owner of Sunday Times and Gallo Music Publishers says it is considering delisting from the JSE and it will also dispose of its entire stake in local investment holding company Kagiso Tiso Holdings. The former owner of Sunday Times and Business Day said its board has resolved to that will it be better to delist as the company's investments in SA have reduced considerably in the past year and the JSE listing has not been that beneficial in giving it access to capital through the market.
Tiso Blackstar has significantly reduced its investments in the past year, selling media titles like Sunday Times and BDFM in 2019. On Friday, it further announced that it had entered into a written agreement with Tiso Investment Holdings to sell its interest in Kagiso Tiso for a consideration of R850 million.
Tiso Blackstar said its investment in Kagiso Tiso is a non-core investment and, in line with its stated strategy, the time has come for the company to sell its shares and realise the value of that investment.
Following the sale of Kagiso Tiso, the company said its board felt that its operations are no longer big enough to extract additional value from the JSE listing considering the compliance costs that come with retaining the listing.
"Additionally, trading in shares on the main board of the JSE has been illiquid and has yielded little or no value for shareholders for several years," said the company in a statement published on the Stock Exchange News Service (SENS).
The company added that the disposal of its assets has put it in a position where it can present a cash offer to shareholders wishing to dispose of their interests in Tiso Blackstar. As such, it would either create a scheme of arrangement in which shareholders can elect to either have their shares cancelled or retain their shares if they want to.
A cash consideration of R4.15 per share has been proposed for those who choose to have their shares cancelled. Meanwhile, Tiso Blackstar's shares on the JSE closed at R3.50 on Friday. But the proposed scheme still requires shareholder approval. The company said in the event that the scheme is not approved or does not come into effect, an offer of R3.95 will be made to all shareholders who want to dispose of their shares.
The company will use proceeds from the sale of Kagiso Tiso to fund the repurchase of its shares from shareholders, whether the scheme becomes effective or it's forced to make a standby offer.
*This story was amended to show that Tiso Blackstar no longer owns Gallo Music Publishing, having sold its entire stake to Lebashe Investment Group's Arena Holdings in March this year.