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Super Group rights offer is good to go

Sep 11 2015

Super Group’s fully underwritten rights offer of R900m to help fund its acquisition of 75% in the holding company of a German logistics group has passed shareholder muster.

The group proposes to raise this sum through an offer of 35-million shares at R25.70 each, in the ratio of 11.7 rights offer shares for every 100 existing shares held on September 25. The offer is at a discount of 22.1% to the JSE-listed supply chain manager’s closing price of R33 on Wednesday. The share fell 2.42% to R32.20 at Thursday’s close.

The stake in Telo Zwei Vermögensverwaltung, which owns time-critical delivery services provider IN tIME, further diversifies Super Group outside of Southern and central Africa at a time when the regional mining and South African manufacturing markets are weak.

“General economic conditions remain lacklustre and the outlook is relatively weak,” Nedbank said on Thursday.

The acquisition would add trucks and technology to the group, and broaden its overseas holdings, including in the UK, Australia and New Zealand.

Super Group had earlier said it had finalised the acquisition at a “reasonable” multiple of 8.7 times earnings before interest, tax, depreciation and amortisation, based on the earnings of IN tIME for last year.

Letters of allocation for the shares will be listed from the start of business on September 18 to the close of business on October 2. The bulk of the shares will be listed from commencement of business on October 5. The balance of rights offer shares, comprising Treasury shares, are already listed. Excess applications will be allowed.

The total purchase consideration payable by Super Group was €79.2m, or about R1.1bn. This comprised €48.9m for a 75% equity interest in Telo Zwei Vermögensverwaltung and a €30.3m shareholder loan. Unless otherwise noted, all figures in euros had been converted at the exchange rate of €1 to R14, it said.

Super Group’s investment in IN tIME will be funded by rights offer proceeds of R900m and a balance of about R200m using existing cash on hand. The group entered into an underwriting agreement with Investec Bank for the offer up to a maximum value of R1.1bn.

Source: Business Day