When I woke up on Saturday it looked as if Springbok strongman Ox Nche had scrummed down my perimeter fence.
There were three large wood panels pirouetting in between the thorn trees on Lighthouse Road. Two of the cement support columns had been neatly snapped near the base. I would see similar prone and forlorn figures later that evening in the form of England’s replacement prop and lock.
I’m surprised that only my fence was wrecked. On Friday and Saturday we endured the blackest of southeasters, with gusts so violent that my heavy rustic benches were swept clean off the balcony. I spent much of my youth in and around Algoa Bay and I have lived for about 25 years in Kommetjie. But last weekend’s blasts were next-level stuff.
We can only be thankful that it’s too early for bush fires. A buffeted blaze would have been impossible to contain. We had one small casualty, however. Our stout Jack Russell-Mastiff cross, Dexter, was unceremoniously toppled while trotting along the decaying railway sleepers that partition our veggie patch. Embarrassed, he lashed out at the flapping heads of spinach, and in the ensuing rampage around the veggie patch he snapped the delicate stem of one of our precious avocado trees.
Tidal wave offer
There was thankfully a more welcome blast for investors who persistently hold that the JSE is a bargain shop for foreign buyers. Container leasing group Textainer, which was spun out of Trencor some years back, detailed a proposed takeover offer from infrastructure investment firm Stonepeak.
This is the fourth container group to be taken over in the past decade — the most recent being Triton International in April this year (also by an infrastructure investment firm in the form of Brookfield Infrastructure Partners).
This is the fourth container group to be taken over in the past decade — the most recent being Triton in April this year
Readers of this column may recall that in April this year I specifically asked whether the $13bn takeover of Triton might ripple through to Textainer. Not quite a ripple — more like a tidal wave, with Stonepeak offering Textainer shareholders $50 a share (roughly R950 a share) in cash in a buyout deal worth $2.1bn (R40bn).
It’s funny how we financial hacks can invariably invoke the dreaded commentator’s curse. The ink has hardly dried on the FM’s recent cover story on dealmaking, in which one of our observations was that any deals in the short to medium term on the JSE would be struck by hard-nosed dealmakers who would not be prepared to pay steep premiums for the assets being acquired.
Our dour view was seemingly justified when African Equity Empowerment Investments pitched a 115c a share buyout to minority shareholders — which, by my calculations, is well short of intrinsic NAV. Stonepeak, on the other hand, is willing to pay a hefty 46% premium over Textainer’s last traded price before the announcement of takeover intentions.
In fairness, Textainer has always lagged a bigger business such as Triton in terms of market rating. Still, I can’t imagine the faithful Trencor shareholders who retained their Textainer holdings being anything but delighted at the emergence of Stonepeak.
The Textainer deal also follows hard on the heels of the proposed takeover of MiX Telematics by a US rival — which, together with Textainer’s proposed transaction, might heighten investor interest in those small-cap stocks that have “international appeal”. Hulamin, Karooooo, Altech, Montauk, Universal Partners, Capital Appreciation, Lesaka, EPE Capital, Master Drilling, Grindrod, Super Group, Santova Logistics and Stor-Age are a few that spring to mind.
For my own selfish reasons, I might have hoped more than a few retail investors would have retreated at the sight of a 21% decrease in production
Moving on to one of my favourite little dividend stocks, Merafe. I won’t lie that it was a bit disappointing that the production update did not make the share price buckle just a bit. For my own selfish reasons, I might have hoped more than a few retail investors would have retreated at the sight of a 21% decrease in production.
Of course, most longtime Merafe watchers already knew the dip stemmed from planned pullbacks in production to navigate through winter’s higher power prices. These acolytes will also highlight the chunky inventories of R2.4bn, reflected at the end of the interim period, that should comfortably cover sales in the short term. Any worries about chrome pricing might be placated by reading platinum group Tharisa’s recent fourth-quarter production report.
I also note that Vunani Capital Partners (VCP) — which was arguably accorded zero value when it was part of JSE-listed financial services group Vunani — is still trading at a huge premium to NAV on the Equity Express Securities Exchange. VCP had a tougher time in the six months to end-August, with the coal segment losing some steam, but the shares still trade at 233c-234c vs a NAV of 165c a share.
This is worlds away from the harsh realities of deeply discounted investment companies on the JSE, and a situation worth monitoring as VCP’s fledgling positions in online gaming, fintech, renewable energy and commodity trading play out.
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