The Dutchman has been preoccupied for much of the past five years since his appointment unlocking value trapped in Naspers’ share price, which continues to trade at a hefty discount to its 31% stake in its Chinese money-spinner, Tencent Holdings. Discount. Navigate Preview company Navigate Next company. How much tax will be payable on the sale of a house held in trust? Prosus said on Friday it would purchase up to R82 billion in its own and parent Naspers shares, as part of efforts to narrow a discount between its share price and underlying assets. Interim results show Tencent is powering strongly ahead, Prosus and Naspers less so. WATCH: Is there a third way to extricate SA’s economy? Both Van Dijk and Sgourdos referred to the problematic discount of the Naspers and Prosus … Currently, we estimate the Naspers discount to NAV to be c. 45.2% and the Prosus discount to NAV c. 30.2%. In what is a seller’s market, shareholders would have rightly frowned upon an attempt to deploy a R120bn mergers and acquisition budget Prosus flaunted in April. The Dutch firm still became Europe’s largest tech company by market capitalization this week after SAP SE shares declined following a profit warning. No matter how fast the Prosus team runs to chase down the discount, the Tencent team will be running considerably faster driving it up.Being the Internet, there might of course be some totally unseen and currently unseeable scenario that could p These categories enjoyed booming demand from consumers ordered to stay at home across the world in the global fight to contain the Covid-19 pandemic, triggering chase from other deep-pocketed companies forced to look for new revenue streams to make up for the sales destroyed by lockdowns. As can be seen from Figure 1 , these discounts to NAV have gone pretty much one way since Prosus listed on 11 September 2019. Prosus is a global consumer internet group and one of the largest technology investors in the world Go to content. Prosus NV plans to buy back a combined $5 billion of shares in itself and its South African parent Naspers Ltd. in a move designed to boost shareholder value and narrow a discount between the e-commerce giant and its stake in Tencent Holdings Ltd. He walked away from the deal earlier in 2020 but to be back in the M&A scene a few months later when he put in a $9bn cash offer for eBay’s classifieds business, but the US company chose another bidder. Tencent is at the very centre of the global metaverse; Prosus is on the edge trying to pick up scraps. Why would the European tech company invest in anything but Tencent? As a result, Naspers traded at a discount of about 30%-35% of the value of its assets, said Jean Pierre Verster, founder and CEO of Protea Capital Management. The final sale was made at 67.50 euros, a discount to where shares were trading at that time, but a bit higher than Prosus' current … Even before the pandemic hastened the trend towards online shopping, food delivery and other technology platforms, and forced companies across the world to reckon with the new reality, Prosus investors were reluctant to give Van Dijk the thumbs up when he tried to buy a large UK food delivery business, Just Eat, for $8bn. One of our largest aggregate portfolio positions is in the related companies of Naspers (a South African holding company), its subsidiary Prosus (a Dutch media conglomerate focused on the internet in emerging markets), and Prosus’s biggest investment, Tencent (a Chinese internet giant). (Bloomberg) -- Prosus NV plans to buy back a combined $5 billion of shares in itself and its South African parent Naspers Ltd. in a move designed to boost shareholder value and narrow a discount between the e-commerce giant and its stake in Tencent Holdings Ltd.The group will aim to pick up $1.37 billion of its own stock and $3.63 billion of Naspers, Amsterdam-based Prosus said in a … Van Dijk isn’t so much cutting the Gordian knot as learning to live with it. Photographer: Deng Qingle/China News Service. Therefore, Naspers holds an effective 22% of Tencent (72% x 31%). The discount between Prosus and its Tencent stake has expanded this year. But just weeks after the listing, Prosus made a 4.9 billion-pound ($6.4 billion) bid to acquire the British food delivery platform Just Eat Plc. By dint of owning 31% of Tencent, worth about $208bn, as well as other investments made since, Prosus is the EU’s fourth-most-valuable firm. Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January. Prosus NV, which became Europe’s largest technology company this week, has always been something of a Gordian knot for investors. But the discount to the overall Naspers portfolio has become even wider. © 2020 Arena Holdings. 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Talk about nice-to-have corporate headaches, Bob van Dijk, the boss of Prosus, a unit of Naspers’ global internet behemoth, will tell you all about it. ... Prosus, unbundled from Naspers last year, also owns a 31 percent stake in Tencent. Buy. Over the same period of time, Naspers has risen 32.7% and Prosus … As of Monday, Prosus’s market cap of R2.8-trillion is just about 20% less than its stake in Tencent. Navigate Preview company Navigate Next company. At the end of the day, having a smaller discount to NAV would be a good thing for existing shareholders,” Treherne said. Naspers owns 72.66% of Prosus, which trades in Amsterdam. Simple. It is the latest attempt to narrow a persistent gap between the company's market value and that of its stake in China's Tencent Holdings Ltd. ... capitalize on the discount. The company’s shares tumbled, reopening the valuation gap to the Tencent holding. But he said that even if Prosus’s other assets were valued at zero, you would still be buying Tencent at a discount of about 20pc. Over the same period of time, Naspers has risen 32.7% and Prosus … All rights reserved. Van Dijk took over a consumer internet powerhouse, a top-10 global technology investor alongside Softbank, Facebook and Google. Please read our Comment Policy before commenting. “TulAmmo 223 REM 55 GR FMJ STEEL CASE 500 ROUNDS, 7 in Stock” 62¢/rd: 1000 for $620.00: TulAmmo .223 Remington Bulk Tencent: the … That could help narrow the discount. Indeed, it trades at a $59 billion discount to the value of that holding, meaning that investors essentially ascribe a negative value to its other investments, such as Russia’s Mail.Ru Group Ltd. and Brazilian food delivery platform iFood. Indeed, it trades at a $59 billion discount to the … Read more at the SA government's online coronavirus portal or use the 24-hour public hotline: 0800 029 999. Yet five months later, the discount persists. Source: Bloomberg. Now, Tencent’s market cap is $660bn in round numbers. Register (it’s quick and free) or sign in now. But just weeks after the listing, Prosus made a £4.9-billion bid to acquire the British food delivery platform Just Eat. 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Even though Takeaway.com NV ultimately bought Just Eat, Prosus continues to trade at a discount to the value of its assets. Prosus share price leapt to R1 650 on Friday, while Naspers shares also gained more than 4 percent to R3 171. Given that Naspers is worth roughly 30% less than the value of its 73% stake in Prosus, Van Dijk’s series of actions, including separately listing Prosus in Europe, have failed to narrow the discount. Prosus's discount to net asset value is 40%. The focus on Prosus and Naspers has intensified as the companies deal with a valuation gap to Tencent. As the world went into meltdown, life has been good in the happy little bubble that is Taiwan. Prosus is an Amsterdam-listed internet conglomerate. In an attempt to narrow the discount and unlock value for shareholders, Prosus plans to launch a share buy back programme worth R81bn. With M&A deals largely out of the question and having signed a three-year lock-up to not sell any more of Tencent, Naspers should consider selling down its stake in Prosus to boost its free float in Amsterdam and attract more European institutional investors. Prosus shares closed 2.97 percent up at R1 626.93, while Naspers shares closed 3.98 percent higher at R3 152.32. Royal A One Brings Discount Car Rental Deals for Travelers Throughout Washington 1 MINIMALLY INVASIVE PHYSICIANS RECOGNIZED AS “TOP DOCS” BY WASHINGTONIAN MAGAZINE 2016 2017 2018 2019 That's where the move to … Interim results show Tencent is powering strongly ahead, Prosus and Naspers less so. We build leading companies that empower people and enrich communities See all our companies. Both Van Dijk and Sgourdos referred to the problematic discount of the Naspers and Prosus … Prosus is an Amsterdam-listed internet conglomerate. By Loni Prinsloo (Bloomberg) – Prosus NV plans to buy back a combined $5 billion of shares in the global e-commerce giant and its South African parent Naspers Ltd., a move designed to boost shareholder value and narrow a discount between the company and its stake in Tencent … The spin-out from Naspers was intended to reduce the discount at which the company traded to its Tencent stake. Prosus shares closed 2.97 percent up at R1 626.93, while Naspers shares closed 3.98 percent higher at R3 152.32. Source: Sharenet Naspers subsidiary and the largest consumer internet company in Europe, Prosus continued to benefit from its holding in the fast-growing Chinese behemoth Tencent, while its own food-delivery businesses were bolstered by the … Tencent stock has soared 57% increase this year, easily making it the best performer in the firm’s portfolio. Prosus said last month it … Even though Takeaway.com ultimately bought Just Eat, Prosus continues to trade at a discount to the value of its assets. The listing by South African media conglomerate Naspers of assets including part of its Tencent stake via the new Prosus vehicle in Amsterdam in September was heralded as a way to reduce the deep discount to net asset value (NAV) at which Naspers shares trade.. Prosus owns a 30.9% stake in Asia’s online software and payments giant Tencent worth nearly 200 billion euros at Thursday’s closing price. This implies that Naspers has an effective $145bn in value just in Tencent (22% x $660bn). Therefore, Naspers holds an effective 22% of Tencent (72% x 31%). That’s the Gordian knot which van Dijk has the unenviable task of trying to unravel. Naspers wound up selling 22 million Prosus shares, which amounted to 1.4% of Prosus' free-float, bringing Naspers' share of the company down from roughly 73.8% to 72.5%. He previously covered Apple and other technology companies for Bloomberg News in San Francisco. South African e-commerce group Naspers is listing its international internet assets, including its 31% stake in China's Tencent <0700.HK>, in Amsterdam on Wednesday under the name of Prosus. An investor needs to trust that Prosus’ high-risk, high-reward investments and the Tencent … Other business … This was also a problem for Naspers Ltd., the South African company that spun off Prosus in 2019 in part to try and reduce the discount. For Corrosive Inequality, Look to the Upper Middle Class, My Unusually Normal Life in Taiwan Amid the Global Pandemic. Prosus’s own value was just 135 billion euros as of Thursday’s close, including other investments in online classified, payment and food delivery businesses. EDITORIAL: Tencent discount needs Naspers to give up control of Prosus CEO Bob van Dijk might have to wrestle with the valuation conundrum a while longer 10 November 2020 - 05:08 By Loni Prinsloo (Bloomberg) – Prosus NV plans to buy back a combined $5 billion of shares in the global e-commerce giant and its South African parent Naspers Ltd., a move designed to boost shareholder value and narrow a discount between the company and its stake in Tencent … Sell. It is hard to see Naspers giving up that control, meaning Van Dijk is likely to wrestle with the valuation shortfall for a while longer. The company is valued substantially less than its stake in Tencent alone. To contact the author of this story:Alex Webb at [email protected], To contact the editor responsible for this story:Nicole Torres at [email protected]. But he said that even if Prosus’s other assets were valued at zero, you would still be buying Tencent at a discount of about 20pc. That was all down to Tencent’s rapid growth, which helped Naspers grind out double-digit profits and deliver an uninterrupted flow of dividends. Naspers owns 900,000 unlisted A-class shares, which carry 1,000 times more votes than ordinary shares, that kick in as soon as its Prosus stake falls to 50%. An announcement in recent days that Prosus, which houses the company's international assets including the investment in Tencent, will shower investors with more than R82bn in cash through the repurchase of its own shares, is the latest attempt to tackle the valuation shortfall, which stood at $59bn. But the Prosus control structure makes it immune to outside influence on strategy and puts off a universe of active investors who want to have a say on its behaviour. Naspers, Prosus & Tencent: Twin discounts . Prosus owns a 30.9% stake in Asia’s online software and payments giant Tencent worth nearly 200 billion euros at Thursday’s closing price. There was nothing to complain about. The buyback ought to provide some reassurance to investors that van Dijk is wary about overspending on deals, though he can always sell more Tencent stock to fund massive acquisitions when a lockup expires next year. Tencent's largest investor is listing its $130 billion stake in the Chinese internet giant on Euronext Amsterdam. Naspers shares in Johannesburg were … READ MORE Naspers still a discounted venture capital fund after Prosus listing. The Naspers/Prosus double-discount structure, coupled with excessive executive remuneration in the view of many market analysts, is a major headache that will be difficult to rectify. Prosus (OTCPK:PROSF) is selling at approximately a 30% discount to net asset value. This implies that Naspers has an effective $145bn in value just in Tencent (22% x $660bn). Van Dijk learned the hard way that shareholders are skittish about how Prosus uses its funds for new dealmaking. It’s a sensible use of the company’s $8.7 billion cash pile, most of which derives from the sale of some of its Tencent stake two years ago. Prosus’s own value was just 135 billion euros as of Thursday’s close, including other investments in online classified, payment and food delivery businesses. Naspers holds 72% of Prosus and Prosus owns 31% of Tencent. Would you like to comment on this article or view other readers' comments? It’s a good thing. In an attempt to narrow the discount and unlock value for shareholders, Prosus plans to launch a share buy back programme worth R81bn. We build leading companies that empower people and enrich communities See all our companies. Prosus share price leapt to R1 650 on Friday, while Naspers shares also gained more than 4 percent to R3 171. Prosus N.V., or Prosus, is the international internet assets division of Naspers. On Friday, van Dijk seemed to tacitly admit the struggle to find other investments that could rival Tencent in terms of value creation by announcing plans to buy back as much as $5 billion shares in itself and Naspers Ltd., the South African parent company from which Prosus was spun out last year. In the days immediately after the Amsterdam listing in September 2019, the ploy proved successful, as Prosus traded closer to the value of its holding in the Chinese firm. Prosus' share price. The EU’s treaty with the U.K. isn’t a “win,” but it avoids a messy divorce and gives the bloc leverage for the future. MARKET WRAP: JSE rises for second day while rand slips amid Covid-19 spike. As of February 10, the Naspers discount to NAV was 42.6%, at the upper end of its … Having failed to clinch before valuations went through the roof and still grappling with the long-standing valuation mismatch,  he was left with little choice than to hand the money to shareholders. And finance head Basil Sgourdos appears to acknowledge that there may be further actions to come: “We will also continue working on a series of initiatives to further address the consolidated discount to net asset value.”. On Friday, van Dijk seemed to tacitly admit the struggle to … Following a c. 24% rally in the Tencent share price (Naspers owns a 31% stake of the Hong Kong-listed tech Group, which accounts for >80% of Naspers’ net asset value [NAV)]) from c. 4 December 2019 to Monday’s (13 January) close, we highlight what has happened to the Naspers and Prosus discount to NAV below. The Naspers/Prosus double-discount structure, coupled with excessive executive remuneration in the view of many market analysts, is a major headache that will be difficult to rectify. It is the latest attempt to narrow a persistent gap between the company's market value and that of its stake in China's Tencent Holdings Ltd. ... capitalize on the discount. The spin-out from Naspers was intended to reduce the discount at which the company traded to its Tencent stake. The spin-out from Naspers was intended to reduce the discount at which the company traded to its Tencent stake. Login to your OfferUp account to instantly connect with local buyers and sellers, shop, and manage your items. Naspers has long traded at a discount to the value of its Tencent stake alone. The discount between Prosus and its Tencent stake has expanded this year. Tencent: the … It … Prosus is a global consumer internet group and one of the largest technology investors in the world Go to content. And Naspers (NPSNY) still controls Prosus, by the way, with a 74% stake, so Naspers shares represent a discount on top of a discount — 74% of Prosus should be worth $99 billion, yet Naspers in South Africa currently has a market cap of $73 billion, so that’s a 26% discount on top of a 20% discount. Plus they’ll benefit from the reduced share count through greater exposure to the Chinese giant. Tencent’s share has jumped almost 57% so far in 2020, driven by investor interest in tech stocks amid the Covid-19 pandemic. Prosus is a venture capitalist, making high-risk high-reward investments. In the days immediately after the Amsterdam listing in September 2019, the ploy proved successful, as Prosus traded closer to the value of its holding in the Chinese firm. Tencent Investor Prosus Launches $5 Billion Buyback in Bid to Close Value Gap Naspers, Africa’s most valuable listed company and Prosus parent, has struggled to … If Prosus is included in the Eurostoxx 50 index in September as expected, it’s hoped the investment inflows will drive the price up and help narrow the discount between Prosus and Tencent… WATCH: Will bitcoin continue its upward trend in 2021? The global investment group is the largest consumer internet company in Europe, and among the largest technology investors in the world, operating across a variety of platforms and geographies. Buy Prosus for exposure to Tencent and high-risk, high-reward investments, but investors should not buy the stock hoping the discount contracts in the coming years. And that might be what shareholders need. The massive Tencent stake is funding these risky investments. If the Unemployment Insurance Fund isn't used to benefit workers now it might have to fund more jobless workers in future, Rand weakened in early trade as investors sought the safety of US treasuries, The state is abrogating its duty by not enforcing proven safety protocols to prevent Covid-19, South Africans should learn not to take our hard-won democracy for granted, Natural gas burns cleaner than other fossil fuels but it is a fossil fuel nonetheless and the world is drawing away from it, EDITORIAL: Tencent discount needs Naspers to give up control of Prosus, CEO Bob van Dijk might have to wrestle with the valuation conundrum a while longer, He walked away from the deal earlier in 2020 but to be back in the M&A scene a few months later when he put in a $9bn cash offer for. Prosus hopes to close discount to NAV with $5bn share buyback. That may happen, but is unlikely. It’s hard to find other investments that can deliver similar returns. The global investment group is the largest consumer internet company in Europe, and among the largest technology investors in the world, operating across a variety of platforms and geographies. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners. On Jan. 21, Naspers proposed selling more Prosus shares to institutional investors in Europe, and closed the sale the very next day. In this write-up, I will dive deep into the company’s high-risk high-reward investments, which is one of the major reasons why this discount is occurring. Among challenges facing Prosus Chief Executive Officer Bob van Dijk is a persistent gap in the company’s valuation and its crown jewel: A 31% stake in Chinese giant Tencent Holdings. The company’s shares tumbled, reopening the valuation gap to the Tencent holding. In the days immediately after the Amsterdam listing in … eBay’s classifieds business, but the US company chose another bidder. 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