Black Economic Empowerment (BEE) group HCI is planning to unbundle a significant portion of its portfolio and list it separately on the JSE.
HCI which maintains a focus on leisure and gambling industry said after undertaken a strategic review of its investments it took the decision to restructure certain of its investments into a new investment platform called Niveus Investments. Assets included in the portfolio to be unbundled include the group’s 39.9% interest in wine and spirits producer KWV, Limited Payout Machine (LPM) operations and industrial player Formerx.
HCI will be left to focus on its major investments which include hotels and gambling business Tsogo Sun, ETV and YFM.
HCI said the move was intended to provide HCI Shareholders with direct exposure to investments which offer an alternative risk and return profile to their current shareholding in HCI and which have attractive growth prospects over the medium- to long-term.
“The investments which form part of Niveus Investments have, in the past, been overlooked by investors because of their size relative to other larger and higher profile HCI investments. The Listing will provide visibility regarding these investments which will allow investors to better assess their value, and may potentially unlock value for HCI Shareholders”.
The move was also designed to provide Niveus Investments with a further source from which capital can be raised to facilitate future expansion and afford institutions, private clients, and members of the public the opportunity to participate directly in the equity of Niveus Investments.
HCI said it is of the view that Niveus Investments provides HCI Shareholders with an attractive investment opportunity and therefore intends to retain a majority shareholding in the business in order to benefit from the future performance of the investments within Niveus Investments.
HCI shareholders include the investment wing of the South African Clothing and Textiles Workers Union (SACTWU)