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Safari Investments RSA Limited Announces Scheme of Arrangement to Delist from Johannesburg Stock Exchange

Strategic Insights

— 1 min read

Safari Investments RSA Limited, a Johannesburg-listed company, has announced a firm intention to repurchase all its issued shares, except for those held by certain excluded shareholders, through a scheme of arrangement. The move aims to address liquidity issues and reduce costs associated with maintaining a separate listing on the Johannesburg Stock Exchange (JSE). The scheme, approved by the company's board of directors, offers a premium of R8.00 per share to shareholders, representing a significant increase over the average traded price of shares in the preceding months. The limited trading activity of Safari's shares, with only 1.4 million shares traded in the past year, has resulted in a significant discount to net asset value.

Key Takeaways:

  • The scheme of arrangement aims to address liquidity issues and reduce costs associated with maintaining a separate listing on the JSE.
  • The offer price of R8.00 per share represents a premium over the average traded price of shares in the preceding months.
  • The Heriot Group, holding approximately 59.20% of Safari, contributes to the limited trading activity of Safari's shares.
  • The board believes that this scheme provides a liquidity event for shareholders to realize their investments at a defined value.
  • The cost of maintaining a separate listing is deemed unjustifiable due to the Heriot Group's control over Safari.
  • The delisting following the scheme's implementation is expected to result in cost savings, including reductions in audit fees and governance-related expenses.
  • Safari plans to shift its strategy towards a development-focused approach, leading to a reduced payout ratio of distributable income and lower distributions to shareholders.
  • The scheme is classified as an "affected transaction" and is subject to the Companies Act and Companies Regulations.
  • The deadline for fulfilling or waiving the conditions precedent is set for December 31, 2025, with the possibility of extension.

Statistics:

  • 1.4 million shares (or less than 0.6% of the total shares) have been traded in the past year.
  • The Heriot Group holds approximately 59.20% of Safari.
  • The scheme offers a premium of R8.00 per share.
  • The average traded price of shares in the preceding months is not specified.
  • The proposed payout ratio of distributable income is reduced.

Sources:

  • Johannesburg Stock Exchange (JSE): unattributed, "Safari Investments RSA Limited Announces Scheme of Arrangement".
  • Companies Act and Companies Regulations.
  • Takeover Regulation Panel.

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