| Thu 29 May 2003, 11:26 | | Nail board forced to put up 'for sale' sign |
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THE "for sale" signs have finally gone up at New Africa Investments (Nail), after the group's shareholders exerted pressure on the board to end the impasse in deciding on a new strategic direction for the firm.
The call for expressions of interest in Nail's media assets, or the group as a whole, follows an admission by CEO Saki Macozoma in March, after the collapse of talks on the purchase of Johnnic's media assets, that the company's growth strategy had failed.
Since the announcement of a change in direction, Nail has been inundated with informal offers for its media assets, which include a share in radio advertising house Radmark, stakes in radio stations Jacaranda, KFM and Kaya FM, 100% of Sowetan and 50% of Sowetan Sunday World and New Africa Books. It also has interests in film, television and outdoor advertising.
Executive director Kenny Setzin said yesterday that the company had made progress and its media assets were performing well. "But because of the environment in which we find ourselves, Nail has to deal with a number of strategic issues," he said.
This included Nail's strategic focus and future direction, the extent of black economic empowerment in its shareholding, and the level of cash in the company. Setzin said the company had received indications of interest from a number of potential buyers.
Although he would not give details, it is understood that a bid by Macozoma, through his company Safika Holdings, was rejected because it was too low.
Other parties rumoured to be vying for the assets include Johnnic, Caxton, Kagiso Media, Primedia, Worldwide Africa Investment Holdings, ThisDay and Bridgeway. It is understood that Kagiso Media and Primedia are keen on the radio assets, while Johnnic and Caxton are eyeing Nail's print assets.
Primedia's empowerment partners, Mineworkers Investment Corporation, increased its stake in Primedia to 25% from 4% recently, a move seen as positioning it to buy Nail's radio assets.
In the running for the same radio assets is Kagiso Media, one of whose shareholders Tiso Capital is part of an empowerment consortium that bought a 25% stake in Investec recently. Observers said the Investec deal would give Kagiso much-needed financial muscle.
Setzin said the announcement did not necessarily mean that Nail would be sold. A subcommittee of the board was evaluating steps that could be taken to provide greater value to shareholders.
