VENTURES AFRICA- South African investment conglomerate, Mvelaphanda (Mvela) Group, is offering to buy out all the shares in Avusa, a media and entertainment company.
Mvelaphanda, which already own 21% of Avusa Limited is offering a cash and share offer worth about R3 billion ($354,748,214.84 USD) for shares it does not own in the domestic media firm.
The offer, which values Avusa at about 3 billion rand ($354,748,214.84 USD), represents a premium of 19.6% to the Avusa 30 day volume weighted average price (VWAP) per ordinary share of R20.07 as at close of business on 11 June 2012.
The cash offer is being made through Mvela’s wholly owned subsidiary‚ Richtrau No. 229 (Proprietary) Limited.
Mvelaphanda said Avusa’s shareholders with 65 percent of the firm have agreed to vote in favour of the deal and 57 percent of its own shareholders also support the transaction.
The transaction comprises a series of inter-conditional steps that will result in Richtrau becoming a listed entity on the Johannesburg Stock Exchange‚ housing all of Avusa’s assets.
According to Andrew Bonamour, the CEO of Blackstar Group and Interim CEO of Mvelaphanda Group‚ “The transaction presents a unique opportunity to consolidate South Africa’s leading media and entertainment company through a single listed entity‚ and to partner with a strong management team in accelerating a turnaround and new growth strategy for the business.”
“The intention is for the management of Avusa to drive a more collaborative approach to achieve cross-selling and synergy benefits between the businesses and accelerate Avusa’s cost savings and turnaround strategy. Blackstar has agreed to remain invested in Avusa for a minimum period of three years to ensure that the operational turnaround is achieved,” Bonamour explained.
Avusa’s media brands include Sunday Times, The Times, The Sowetan, Sunday World, Daily Dispatch, The Herald, ELLE, Home Owner; and others. Its digital businesses include news sites such as SowetanLive, TimesLive and BusinessLive, while CareerJunction provides online recruitment services.
Acting group CEO of Avusa Limited and MD of the Avusa Media Division, Mike Robertson, asserted that “The independent board of Avusa is supportive of the transaction and the flexibility offered to shareholders under the offer‚ subject to a fair and reasonable assessment by our appointed independent advisers Ernst & Young. The new shareholders have committed to upholding and abiding by the spirit and principles of the Avusa Media Editorial Charter‚ which promotes a free media and editorial independence.”
“We look forward to working with Blackstar and the new shareholders of Avusa towards positioning the group to capitalise on its key competitive strengths and execute on future growth opportunities‚” Robertson added.