Multichannel digital satellite and pay-television (TV) giant MultiChoice Group (MCG) on Wednesday listed on the JSE’s main board, and slotted into the top 40, with an opening share price of R95.50.
The listing, which was the first at the JSE for this year, followed afetr parent company Naspers decided last year to list its video entertainment business separately and simultaneously unbundle the shares in this business to its shareholders.
MCG comprises MultiChoice South Africa, MultiChoice Africa, Showmax Africa and Irdeto, with Phuthuma Nathi shareholders allocated an additional 5% stake in MultiChoice South Africa for no consideration.
This bumps Phuthuma Nathi’s indirect interest in the subsidiary from 20% to 25%, resulting in a 25% increase in dividend flows.
This is expected to deliver long-term benefits to 90 000 individual and institutional broad-based black economic empowerment (BBBEE) shareholders, with a return on investment of about 17 times since inception.
In a 2006 BBBEE deal, Naspers had facilitated, structured and funded the sale of a 20% interest in MultiChoice South Africa to black investors through Phuthuma Nathi.
MCG joins five companies listed in the media sector on the JSE, which prior to the MCG listing, contributed 9% to the total R1.39-trillion market capitalisation of the JSE.
“Today’s listing is an important milestone in our exciting journey of growth. As one of the fastest-growing pay-TV broadcast providers globally, our strong financial position at listing is backed by attractive long-term growth opportunities in both subscriber numbers and revenue,” said MCG CEO Calvo Mawela.
He added that MCG had a highly cash generative core with no financial debt.
MCG currently has an entertainment and sport content subscriber base of 14-million across 50 African markets – with the potential of growing this to 40-million as the business on the continent stabilises.
“There is meaningful scope to drive up pay-TV penetration in the rest of Africa in the mid- to mass-market, while the connected video services represent a fast-growing, longer-term opportunity.”