JOHANNESBURG — In about a week from now, Naspers will release its full earnings report – an event that is an annual highlight on the JSE calendar. Already, the results are shaping up to be stellar. According to a trading statement, Naspers said it expects its core headline earnings per share to rise by 70-75%. What will be interesting to watch out for in next week’s results is whether CEO Bob van Dijk will make any announcements regarding rumours of a separate MultiChoice listing on the JSE. In order to close the discount gap that Naspers’ shares have on its Tencent stake, there’s been talk of a separate spin-out. I posited this question and more to van Dijk in an interview earlier this year – but he was mum on the issue. If you’re a premium subscriber, you can view the interview by clicking here. – Gareth van Zyl

By John Bowker and Janice Kew

(Bloomberg) – Naspers Ltd. expects to report an increase in earnings for its most recent financial year, bolstered by Chinese internet giant Tencent Holdings Ltd. and various e-commerce businesses.

Core headline earnings per share, which exclude one-time items, rose 70 percent to 75 percent in the year through March, Cape Town-based Naspers said in a statement Wednesday. The company didn’t provide details on the trading performance of individual units, which also include Africa’s biggest pay-TV provider, but will do so in a full earnings report on June 22.

Africa’s largest company by market value has long piggy-backed on fast-growing WeChat-creator Tencent, in which it owns a 31 percent stake. Meanwhile, Naspers is investing in other media and technology businesses around the world, with a particular focus on online retail such as food delivery.

The fiscal 2018 financials incorporate a change in accounting policy, which also required a restatement of core headline earnings in the previous year to produce comparable figures. Naspers didn’t historically include amortisation of intangible assets in the calculation, but will now take account of the amortisation of Tencent’s digital content costs, according to Meloy Horn, Naspers’s head of investor relations.

‘Strong Numbers’

“Those are pretty strong numbers given the valuation of Naspers,” said Michele Santangelo, a money manager at Independent Securities in Johannesburg.

The shares rose 1.2 percent to R3,393 at the close in Johannesburg, valuing the company at R1.5 trillion ($113 billion).

In March, Naspers raised HK$76.9 billion ($9.8 billion) by selling a 2 percent stake in Tencent, and plans to use the money to invest in classifieds, online food delivery and financial technology businesses. The company then netted a $1.6 billion profit from the sale of a stake in Indian e-commerce startup Flipkart in a deal with Wal-Mart Inc.

Naspers’s 31 percent stake in Tencent is worth more than the company as a whole, and Chief Executive Officer Bob Van Dijk has pledged to narrow the valuation gap.

LONDON — In this special podcast, RMB Investment Banking Director Ferdi Vorster tells us about the project which simplified a complex structure for the Distell Group to position it for a new growth path. The Distell Group, created in 2000 by a merger of Stellenbosch Farmers Wineries and the Rupert Group’s Distiller Corporation, has been hamstrung by a highly complex ownership structure. Here’s the story of how that Gordian knot was addressed.- Alec Hogg

Ferdi, you’ve been at this for four years.

Yes, Alec. This structure has been in place for a very long time. There was a period in South Africa when these types of control structures were quite popular. Various layers of companies would be inserted above listed companies, and through the holding of 50% or more through these layers, you could effectively control those structures. Distell was one of these companies.

There were a few others, but over a period of time, these structures became very unpopular with shareholders because it had a detrimental effect on those companies – principally because it limited their free-floats and ability to raise capital. As you know, typically, the JSE requires a minimum free-float for a company of 20%-plus. Distell was below that level and although the JSE condoned those types of arrangements, it had an impact on the tradeability of the shares, purely because of the fact that a large chunk of the shares was locked up in these controlling structures.

On top of that, it created a discount if you flowed through these structures at various levels. Typically, investors would want to try and arbitrage the underlying value of these structures by investing in the upper layer of the structures where it was typically discounted in. Over a period of time, investors decided they don’t like these types of structures because of their largely detrimental effect on these companies.

Just as a thought there, maybe unpack a little more. It wasn’t quite an “N”share structure but something of a pyramid where in the past, you had well, you’ve still got it with Naspers for instance as a Naspers N-share. You used to have Primedia N-shares and at some point in time, the JSE tried to address all of this. Did Distell fall into this camp?

No, Distell didn’t fall into that exact category as Naspers did. The Naspers structure still has N-shares, but the Distell one was slightly different in that you had 52.8% of those shares sitting in a company called RCI. RCI was an unlisted vehicle and effectively was joint-controlled by Remgro on the one side and Capevin on the other side. Both of those companies had 50% in RCI. Capevin was also a listed vehicle with RCI being its only asset.

Effectively, that controll structure was a double-layered structure as opposed to the N-share structure where the voting in the shares are slightly manipulated, so it’s a slightly different one from the Naspers situation. These structures were typically set up through families. Pick n Pay had a similar type of structure and that one has also been collapsed.

Right, that was Pickwick and Pick n Pay of course, on that side. Just to go back here: it must be really difficult to get decisions made if you’ve got Capevin on the one side and Remgro on the other? Were they able to work together?

They were friendly. I think the benefit of this collapse was that shareholders in Distell specifically asked for the structure to be collapsed. I think that even with Capevin there were a number of shareholders that started to realise that adding an additional layer is detrimental to the tradability of the shares.

The larger shareholders like Remgro and Capevin – although they were the effective controllers – had to listen to what other shareholders were asking. It’s something that’s been discussed for many years at shareholder meetings at Distell.

Distell was open to collapsing the structure but could just never find a way to do it in a manner that would make all the shareholders and stakeholders happy. We started on the design of this transaction about four years ago, so it was quite a long time. It was a difficult process with a long path to come up with a solution that all parties were happy with.

I think the intent was always there. It was just to find the correct way and means to do it to make all shareholders happy. We were quite fortunate in coming up with the mechanism to do it.

Before we look at the structure itself, with 52.8% in a controlling shareholding structure, I guess that did restrict the ability of the Distell Group to grow through issuing additional shares.

Without a doubt. I think that was a large part of why the shareholders were asking for a long time for the structure to be collapsed. You can well imagine that for Distell to raise cash from its shareholders (typically this happens though rights issues), it often has a dilutionary or accretion impact on shareholders. The controlling shareholder being the RCI company, would have been fairly reluctant to allow any rights issues to happen if it could impact its 52.8% share. You can also realise that the buffer isn’t that great above 50%.

For a very long time Distell had to rely on its own internal cash to achieve its growth. Although it had a very healthy balance sheet, the major portion of the growth was funded by loans from banks. In an environment where interest rates are starting to creep up, that could have a negative impact on companies.

I think Distell did quite a lot for its ability to grow, purely because it never had the ability to use its shares in some shape or form as currency for acquisitions or to raise cash from shareholders. That was one of the big drivers for Distell to collapse structure because they were just never able to raise cash from shareholders.

It’s a sizeable business – 5 000 employees, ZAR17-bn in turnover, ZAR1.5-bn in profit – so you can see it’s almost at that level where it now needs to flex its muscles and to move on to the next level, I guess. You said that you’ve been working on this for four years now.

Yes. When RMB gets involved in these types of transactions, people often think that we just lend money to clients, but a big part of what we do in our Corporate Finance division is to come up with solutions for corporates besides just giving them money. When you start to look at this, you know that there’s a shareholder’s stake and there’s a demand for the client to come up with a solution.

We went through various iterations and scenarios to try and develop something that we thought was workable. We also had to test that with the company. We had to canvas this with the shareholders and clearly, in the South African environment, there’s a lot of regulatory requirements that one needs to adhere to which means we had to go to the JSE and the FSB.

The TRP became involved, so it took us quite a bit of time to eventually persuade the company that we had a solution that could work for them and ultimately all the shareholders, while getting all the necessary approvals. Typically, the approvals involved the JSE, FSB, TRP and although not directly involved in this one, one has to get the Reserve Bank to also sign off on these transactions.

It’s an iterative process. Just when you think you have a solution, someone has a problem with it. You need to make a change and you then have to start the process from scratch and go through all those levels again. That’s partly why it took so long to come up with something that we really believed would be approved by all parties.

From a commercial perspective, do you start a process like this on risk or does the board of Distell say, “There we go, guys. This is our problem. How do you find a solution for us?” Clearly, that’s RMB’s game, isn’t it? Solutionist Thinking.

Yes. I think we pride ourselves on being Solutionist Thinkers. We are an investment bank and we charge an investment banking fee, but it’s a service that we deliver to companies to find innovative solutions, so that they can concentrate on running their business. They don’t always have the internal resources nor the time to think about these types of solutions. That’s our role – to assist companies to do those types of things and ensure that in the process, we come up with answers and solutions that could create shareholder value.

Once you’ve looked at the complex structure (and we now know that on the 6th of June, it was relisted), how different is it today to the situation that existed in the old listing of Distell?

We re-listed the new company,, but effectively. the new Distell company is a mirror of the old company. We effectively acquired the full structure that existed in Distell previously and that now sits below the new holding company.

From an operational perspective, very little will change. It will be business as usual. The one benefit that we now have is that we have one layer of shareholders in the new company, so there’s no double entry points for shareholders, which typically result in limited free float. In the previous structure Distell’s own free float was roughly 20% because that was from outside shareholders and many shareholders sat in the Capevin structure.

By consolidating the Capevin shareholders and the minorities in Distell into one block, you now have a free float of roughly 40% in the company. In our world that has a nice impact on the tradebility of the shares. Another benefit is that through the double-layered structure, you’d typically have shareholders who would try and arbitrage the share price and it doesn’t really give you a fair reflection of the underlying assets value in the company. By having this one single entry point into the company, you suddenly start to see that people aren’t trading the shares to seek the premiums or the value differential in the structure. They now need to invest in the company and take a view on the underlying value, so that the new value of the assets will start to be reflected in the share over a period of time. Distell now has the type of structure that they can go to shareholders with and raise cash with through rights issues to help them with their growth.

It’s a R29bn market capitalisation now – the new company. What was it before? What I’m trying to get at here is whether the value has yet been unlocked.

I think the market cap is very similar. It will take a little bit of time for investors to understand the new structure. There are two things influencing a share price: the view people take on the asset and the view that the market takes overall. I think at the moment everyone understands that there is a bit of negativity on the JSE and share prices are a little bit depressed. We hope and believe that as soon as there is a more positive sentiment in the market as whole, the share price will start to pick up and the market cap will go up over a period of time.

Another benefit of this structure is that with the increased free float, the Index Tracker Funds  would now also start to show more interest in the stock due to the increased free float. So it will attract some new investors to that.

I think it’s going to take a bit of time for the market to understand the new structure and with some positive sentiment coming back into our market over a period of time, I think it will have a positive impact on the share price and the market cap.

Would a structure like this make it possible now for the group to expand globally?

Yes, I think it would. I obviously can’t speak about the group’s plans but the CEO did say in the press that the company is planning to exand.. Africa is a specific focus area. The new structure is likely to give them that ability.

As I said previously, where they could not use their shares as currency to make acquisitions, they are now able to do just that. I think it was also reported in the press – not too long ago – that they’ve made a large acquisition in Africa and they’ve also disclosed to the market that Africa is a big target for them.

And, the fact that they have identified Africa as the opportunity into which they would like to expand – an area where you’ve been spending a lot of time and you’ve got lots of representation there – no doubt, you already have some ideas in the back of your mind.

Yes. Africa is a place where everyone is looking to make acquisitions. A few years back it was very popular. Foreigners were seeking to get their pot of gold in Africa. The macroeconomic issues have had a bit of an impact on growth factors in Africa for the last three to four years, but those things should start to stabilise soon as those issues become more stable.

I think the growth in Africa is still somewhat higher than what people can get in Europe and in the more developed countries, so it will always be a popular place for investments. As the usage of alcohol is still much lower in Africa than it is in Europe, there’s a large opportunity for them to grow their business there. It’s always a question of, “Where do you find the right target for the right price?” and yes, maybe we’ll have another two to three years to go through, but hopefully we can help them find those targets.

That was Ferdi Vorster, the Investment Banking Director at RMB and this special podcast was brought to you by RMB.

JOHANNESBURG — It’s incredible to watch how Naspers has gone from a traditional newspaper publisher to essentially a venture capital company that is spreading its money across the globe. The latest Series G investment in Swiggy, which has been led by Naspers, comes as the food delivery space in India heats up. A quick look at the Swiggy website reveals that the startup is a serious player in this space. And with Swiggy having notched up a valuation of over $1bn, it’s no wonder that the deal is grabbing tech headlines around the world, including in the much respected Silicon Valley-based tech site TechCrunch (read their story by clicking here). – Gareth van Zyl

By Saritha Rai

(Bloomberg) – Indian startup Swiggy has raised $210 million in a round led by South Africa’s Naspers Ltd. and investment house DST Global, setting a stage for a battle between well-funded players in the sizzling food-delivery sector.

By Loni Prinsloo

(Bloomberg) – Naspers Ltd. has put aside the proceeds of share sales in Chinese internet giant Tencent Holdings Ltd. and India’s Flipkart to pay for new investments due to the abundance of opportunities in its preferred media and technology markets.

Africa’s biggest company by market value raised HK$76.9 billion ($9.8 billion) in March by selling a 2 percent stake in Tencent – its flagship asset and by far the most lucrative. Naspers then netted a $1.6 billion profit from the sale of a stake in Indian e-commerce startup Flipkart to Wal-Mart Inc. in May.

“The reason why we freed up the money is that there is a lot of opportunity to invest at the moment in our core growth sectors: Food delivery, classified or in our payments business,” Chief Executive Officer Bob Van Dijk said in a phone interview Friday, after Naspers reported a 72 percent rise in full-year earnings. “That is where the bulk of the money will be invested in.”

The South African company has long relied on its stake in fast-growing WeChat creator Tencent to accelerate profit growth, yet its myriad investments in newer online companies around the world are beginning to bear fruit. Classifieds businesses in Brazil and Russia helped to generate the first-ever profit at the division – when U.S. app Letgo is excluded – while Naspers is working to improve profitability at Africa’s largest pay-TV provider.

Car Sales

A recent new investment was the $89 million spent last month on Berlin-based Frontier Car Group – a vehicle-sales company that operates both online and out of physical lots. “People want an easy, hassle-free way to sell their cars,” Van Dijk said. “The model is being replicated by Frontier Cars in Africa, Latin America and Asia. There have to be local tweaks to make it work, but the concept is a very good one.”

Core headline earnings per share, which exclude one-time items, were $2.5 billion in the year through March, Cape Town-based Naspers said in a statement Friday. The company raised the dividend by 12 percent to R6.50 a share.

The shares gained 3.1 percent to R3,315.27 by the close in Johannesburg, the biggest rise since June 1, giving a market value of R1.5 trillion ($111 billion).

LONDON — Imtiaz Patel runs the Naspers Video Entertainment business which has 14 million customers. Under his guidance the business has just experienced an excellent turnaround after a two year restructuring. CEO SleepOut veteran Patel likens his company’s rebound to what is in prospect for South Africa – and he has challenged heavy hitters Jabu Mabuza, Sipho Maseko and Shameel Joosub to brave the elements and accept the challenge to overnight under the stars at Liliesleaf on July 11th. – Alec Hogg

I’m Imtiaz Patel. I’m the CEO for Video Entertainment for Naspers, which essentially means MultiChoice across Sub-Saharan Africa.

And 14 million people?

And 14 million customers in Sub-Saharan Africa, of which just under 7 million are in SA.

That’s a huge base. It’s highly influential. I know you guys do quite a bit of CSI?

Yes, some stats in SA which we are very proud of. We pay over R6bn in tax, direct and indirect taxes. We spend over R3bn per annum on small and medium sized enterprises. Most of which are black enterprises. We fund sport to the tune of more than R2bn per annum.

These are huge numbers.

We spend R2bn on local content, on production of local content so there’s thousands of people who would benefit from local productions that happen in small shops and in big production companies. Then of course, the value chain – we have hundreds and thousands of people who would install dishes and decoders, as an example, so that’s all part of the CSI program, and obviously, we’re very proud of it. Then through SuperSport we do the MultiChoice Diski Challenge, which is the development competition in the PSL. We do a rugby challenge, which is the development competition in rugby so, there’s a number of things.

We’ve known each other for many years. I remember at the time that I was at Absa, which is more than 20 years ago, you were with what was then Transvaal Cricket, and development is in your blood.

Yes, and I started-out teaching in Soweto, at Pace College in 1988. I taught there for 3 years and Ali Bacher had just started a cricket development program in the townships. So, I used to teach in the mornings and coach for him in the afternoons, and then went fulltime in 1991. Then moved from running the development program for a few years to becoming the director for Professional Cricket as Ali’s number two around 1997/98. I did that for 3 years and then joined SuperSport in late 1999.

Cricket was way ahead of the other sports, or it seemed to be anyway, in development.

Yes, I think as with all things one needs a visionary and, in many ways, Ali Bacher was a visionary by any standards, and by benchmarking any administrators across the world, in every sport, he would stand out as top-notch. Yes, he had a vision. He drove it purposefully, and he drove it singularly and as with all visionaries, people who see the light follow, so we followed.

Well, it was quite a lot of vision in creating the CEO SleepOut in 2006 in Australia, and it came to SA in 2015. You’re supporting it this year, the one at Liliesleaf. What does Liliesleaf mean to you?

Well, first of all we’re supporting it. We’ve supported it in the past. I had the luxury of sleeping on a very cold night on a street in Sandton some years ago. Then I got my colleague to sleep on, I believe what was a colder night, on the Nelson Mandela Bridge, a couple of years ago, so good luck Alec.

So you’re not coming this time? You’re sending colleagues this time?

I’m sending colleagues this time because I’m not going to be in the country.

A pity, I would have liked to have shivered with you.

Absolutely, no question.

We’ll swap notes after the 11th of July, but Liliesleaf?

Yes, Liliesleaf brings lots of emotion, lots of thoughts. I spent a lot of time with Nic Wolpe in the last few years trying to help him raise money, visiting the place, looking at the museum. They’ve done an unbelievable job. One always sort of feels that you want to take more people there when you visit the place. It’s a very important time in your own head to create a juncture and a reminder of our history. When you think of Mandela, and Kathrada, and what that moment meant. It’s a deeply emotional place, in some ways, but it’s a deeply powerful place. I think it’s very appropriate at this point in time in the life of our country that the sleepout is happening there.

On the 55th anniversary of the raid.

On the 55th, and that is extremely powerful. I don’t know what your program is for the night but I hope the organisers are going to do something, maybe around a talk on what happened 55 years ago and what Liliesleaf means and maybe a bit of history, because many of us are young. Or many other CEOs are young and I think reminders are important and creating a shared history is absolutely critical. I think for all of us to get together and create a shared history or a shared future for our children, and I think that concept of a shared history where we can all start with standing in each other’s shoes is so powerful. I think black and white CEOs and their colleagues that they’ll be bringing along. By the way, that’s a very powerful thing, I think, to do. I think it will be a very important moment for CEOs to reflect. Not only because it allows us to think about the poor in our country, and there are many of them. But I think reflecting about how we can take this country that’s in a very difficult moment in its time, and take it forward collectively, with that shared history in mind.

Nic Wolpe will be there, your friend. I’m sure he’s going to be popping around to different groupings to share the story of Liliesleaf, which is an amazing story, as you well know. But what about Nelson Mandela? He wasn’t arrested at Liliesleaf. He spent a lot of time at Liliesleaf, but what does he mean to you, his legacy?

My God, how can… He means so many things to all of us. My overriding memories, when I finished Long Walk to Freedom, I closed the book with tears in my eyes. I think he is what we all aspire to, but we can’t even get there. So, in a sense, it feels overwhelming to aim to be some little bit of what he was. But he represents a beacon of what we can all aspire to. For me, that’s a very important thing, and it’s a reminder. He’s in our subconscious every single moment, I think, of what responsibility we should be carrying as individuals, and I guess, as leaders of companies, and whatever leadership positions we have, in our own homes with our children – it’s the best I can do to describe him.

Dr Makaziwe Mandela, his eldest daughter, is the patron of the SleepOut this year, and what’s also quite pertinent here is that the Liliesleaf Sleepout on the 11th of July is exactly a week before Madiba would have turned 100.

My god.

So, it’s all kind of coming together. Who would you challenge to, if they aren’t already coming, to actually get out there on the 11th of July?

I’ve got quite a few people I want to challenge. First of all, Jabu Mabuza, my good friend.

I second that.

Secondly, Shameel Joosub, from Vodacom.

I second that one too.

Sipho from Telkom – come on boys, you’ve got to be there.

So, we’ve got the ‘big-3?’ Oh, and I’m sure they could bring some of their colleagues along as well.

No question about it.

And all three of them would keep us pretty well entertained, particularly Mr Mabuza.

Absolutely, Mabuza will keep you entertained for sure.

Imtiaz, and as far as the business is concerned. We’ve just had the Naspers’ results, MultiChoice is continuing to do well. Hanging in there, despite some incredibly tough competition.

Yes, the Sub-Saharan Africa business went through a really tough time a couple of years ago. If you recall, commodity prices fell through the floor. Currencies devalued heavily. Those economies went through a really hard time so, we’ve spent quite a bit of years, 2 years in fact, trying to turn that business around. I think we’ve done a fine job. It’s stabilised, currencies have stabilised, macroeconomics have stabilised. In SA we’ve got fundamental shifts that are happening in our industry so, over the top operators, like Netflix, like YouTube are big gorillas that have entered our space. Consumer trends are shifting. Young people don’t watch TV, they watch TV on a mobile screen. Technology changes – and we’ve got to stay abreast of that. It’s impacted the top-end of our subscriber base. Partly, also, because of the economics of what’s happening in our country, affordability issues. The bottom-end is robust, we’re growing there. It does impact on our margins, and we’re spending a lot of time transitioning to our ‘over the top products.’ We’re spending a lot of time looking at cost base.

Lots of challenges?

Lots of challenges, no question about it.

When you say, ‘transitioning to the over the top’ taking account of what’s happening in the world as a whole. How will MultiChoice look in 10 years time, compared with today?

I think quite fundamentally different. So the success of our Showmax product is extremely important. The success of our DSTV Now product is extremely important. It remains to be seen whether we will snap off other kind of smaller over the top packages, where you can consume sport as a separate package, general entertainment as a separate package. But it has major impacts on the economics of the business models, and that’s just where the world is going. My one concern is that regulators in SA are looking in the rear-view mirror and trying to regulate into the future. When there are fundamental shifts taking place in this industry, to take them along with us, to get them to understand that it’s not about today or about tomorrow, it’s not about 3 years. It’s about looking 10 years and allowing African and SA companies to be enabled through regulation to compete with these international giants. That’s the big challenge for regulators and it’s a big challenge for us to take regulators along. So in a nutshell I think the business has had a good year, a stabilising year, but challenging times ahead.

Well, I’m glad you’ve had a good year because once again, you’re supporting the CEO SleepOut, and you’re going to be sending your colleagues there because you have found a reason not to be in the country at the time.

My colleagues are going to be there. We’re very excited about the support. I think you’ve come onboard, which is very powerful for it. You’ve twisted our arm to get involved again so that’s very powerful. I think, when you describe all the things about Liliesleaf and 55 years ago what happened, and 100 years of Mandela’s birthday – it’s a coming together, in some ways, a number of moments could prove for this CEO SleepOut to be a very powerful moment for leaders getting together and saying, ‘let’s reflect on what do we do and going forward, to create a future of our country?’

Imtiaz Patel, good to see you, as always, here in London so, you are out of the country actually.

I am.

Well, maybe CEO SleepOut 2019, we can get an even colder night and the two of us could go there together.

Definitely, you’re on.

Media statement:

PayU today announces the acquisition of leading payments technology platform ZOOZ. The deal supports PayU’s ongoing expansion into high growth markets and targets the $994 billion opportunity in cross border payments.

The ZOOZ acquisition is for an undisclosed amount but brings PayU’s total sum of investments and acquisitions in global fintech to more than $350 million since it began a series of strategic moves across the globe in 2016 to open access to financial services.

The ZOOZ and PayU teams will work together to create the leading, global standard payments infrastructure of the future. As part of this vision, they will build a comprehensive, modular, and highly flexible ‘Payment OS platform’ that can support evolving merchant and broader payment industry needs. The platform’s immediately expected features include fraud management and real time reporting or smart routing, to better aid global merchant growth.

The deal follows a successful partnership, which, for the first time, gave PayU merchants such as Gett and Kiwi.com access to 2.3 billion new customers across high growth markets via the ZOOZ-designed PayU Hubplatform. It leverages PayU’s payments infrastructure and ZOOZ’s state-of-the-art technology to open up access to new markets for merchants with global aspirations and sets a new standard for payments across borders.

As part of the deal, due to close summer 2018, ZOOZ’s co-founder and CEO Oren Levy and CTO Ronen Morecki will become part of PayU’s Global Leadership team, focusing on tech and business development. ZOOZ’s 70-strong team of experienced technical and payments experts will also become part of the PayU team, boosting the business’ technical capabilities.

Laurent le Moal, CEO of PayU, said: “PayU is one of the most active investors in the fintech space and we are always looking for opportunities to innovate and support our merchant clients to grow. Today’s announcement is a great illustration of this philosophy in action and we are pleased to be welcoming the ZOOZ team further into the PayU fold. By working together to create the first ‘Payment OS’ platform we will advance PayU’s mission to help build a world without financial borders”.

Oren Levy, co-founder and CEO of ZOOZ added: “After a year-long, productive partnership, our shared vision to create a new global standard in payments infrastructure is becoming a reality with PayU’s acquisition of ZOOZ. The unique contribution we bring to PayU is an advanced technological layer which not only helps merchants worldwide to upscale their operations and provide a better customer experience, but also offers analytics and optimisation capabilities that equip them with unprecedented insights”.

With the cross-border market expected to reach $994 billion in 2020, nearly two-thirds of cross-border business will come from high growth markets like Asia and Latin America, according to a report by Accenture. Alternative payment methods still represent as much as two-thirds of all payments in these markets.

ZOOZ was founded in 2010 by Oren Levy and Ronen Morecki. It has become one of the most well-known payments technology players in Israel.

PayU is part of Naspers, a global Internet and entertainment group and one of the largest technology investors in the world. Following completion of the deal, ZOOZ will be wholly owned by Naspers, strengthening its payments division and supporting its strategy to grow its financial services footprint across emerging markets with long-term growth potential.

JOHANNESBURG — It started with Saudi Arabia, quickly followed by the United Arab Emirates, to see South African president Cyril Ramaphosa edge closer to his publicly declared investment target of R1 trillion. And he’s another step closer today following China’s pledge of nearly R200 billion, in the lead up to this week’s BRICS summit. Ramaphosa is facing headwinds on the local front with living costs spiralling, job creation, land expropriation seemingly a concern for local and international investors, and a clear for all to see split in the ruling ANC. But what he has got right is the foreign investment pledge. With China, around R466 billion has been earmarked for South Africa, that’s almost halfway there and only three country’s down.  The next step that South Africans would want to see is for the money to arrive in the country and be put to good use, and not find its way to the deep pockets of State Capture. – Stuart Lowman

By Amogelang Mbatha and Pauline Bax

(Bloomberg) – China pledged to invest $14.7 billion in South Africa and grant loans to its state power utility and logistics company as the two nations seek to strengthen economic ties and increase trade. The rand gained.

The investment pledge and loans were announced after a meeting between South African President Cyril Ramaphosa and his Chinese counterpart, Xi Jinping, in Pretoria on Tuesday. Xi is on an official state visit to South Africa ahead of the 10th summit of the BRICS nations – Brazil, Russia, India, China and South Africa – that begins in Johannesburg on Wednesday. China is South Africa’s biggest trading partner.

“China is ready to invest and work with South Africa in various sectors, such as infrastructure development, ocean economy, green economy, science and technology, agriculture, environment and finance,” Ramaphosa told reporters. “We also recognise that although trade figures have grown steadily over the past few years, bilateral trade has not reached its potential. We have thus explored avenues for increasing trade, identifying sectors for future investment and promoting tourism.”

Investment summit

Cash-strapped power utility Eskom Holdings SOC Ltd. secured a $2.5 billion long-term loan facility with China Development Bank, taking the funding it’s secured to almost two-thirds of what it needs for this year. Port and freight rail operator Transnet SOC Ltd. agreed to a long-term loan with Industrial & Commercial Bank of China Ltd., and Naspers Ltd., the owner of Africa’s biggest pay-TV provider, signed a multi-currency facility accord with Bank of China.

“China and South Africa relations are at a new historical departure point,” Xi, who visited South Africa twice before, told reporters. “President Ramaphosa and I had a very productive discussion during which we discussed further taking forward our strategic partnership. We need to build closer high-level engagement.” China will support an investment summit that the African nation is hosting in October, he said.

The rand climbed as much as 1.2 percent against the dollar and was 0.9 percent higher at 13.3447 at 2:30 p.m. in Johannesburg.

“The rand is firming because our president is making it rain,” said Wichard Cilliers, a trader at Pretoria-based Treasuryone Ltd. “He has just secured another big investment, this time from China. That means new FDI inflows.”

JOHANNESBURG — It’s no secret that Naspers is currently trading at a hefty discount to the value of its stake in Tencent as well as its total assets. And in a bid to deal with this, Naspers CEO Bob van Dijk has said the company’s board is mulling separate listings of some of its units to help close this discount gap. It will be interesting to see which businesses it lists separately and the choice of exchange. The likes of Hong Kong might be a natural choice for Naspers in this regard, considering its stake in Tencent. But many South African investors will be happy to hear that Naspers intends keeping its primary listing in Johannesburg. – Gareth van Zyl

By Loni Prinsloo and John Bowker

(Bloomberg) – Naspers Ltd. is considering the listing of certain parts of its sprawling global media and technology business outside South Africa as the continent’s largest company by market value seeks to reduce its size.

The company takes “very seriously” the difference in value between its stake in Chinese internet giant Tencent Holdings Ltd. and the firm as a whole, Chief Executive Officer Bob Van Dijk said in an interview on Thursday. Naspers’s weighting on Johannesburg’s stock exchange of more than 19 percent is also too high and forces some investors to reduce their holdings, he added.

That said, Naspers is committed to retaining a primary listing on the South African city’s bourse, the CEO said in Johannesburg, where he was attending a summit of BRICS nations.

“The logical next step would be to list parts of the business to see of we can reduce the overall size,” he said. “We are discussing with our board.”

Naspers has for years ridden the back of an early-stage investment in Tencent that’s paid off many times over. The company has since scoured the globe for opportunities to replicate that success, and has put cash into ventures ranging from online travel agents in India, food delivery in Brazil and education software in the US. There’s still plenty of investment opportunities available, meaning Naspers isn’t considering a buyback, Van Dijk said.

Mobile-payment technology has been identified as a cornerstone of Naspers’s investment strategy, Van Dijk said. The Cape Town-based company will spend “several billions” of dollars in the industry, with the most recent purchase being ZOOZ in Israel. Online education – particularly in skills such as writing code – is another high-potential area, while future markets include technology to help the elderly.

“We believe the world needs tens of millions more software engineers,” Van Dijk said. “Online education is an area we’re really excited about.”

JOHANNESBURG — Among US stocks, Facebook might have lost an eye-opening $136bn in recent trading sessions, but Tencent’s losses may have Naspers’ shareholders sweating a bit at the moment amid the Chinese tech giant having lost $140bn in market value this year thus far. On Tuesday morning in Hong Kong, Tencent’s share price was already down over 3.5% in trade, marking yet another bad day for the company. It appears as if the good days have come to a rapid end for global tech stocks. And it will be interesting to see if Naspers then still goes ahead with a plan to list some of its businesses amid this rapidly changing environment. – Gareth van Zyl