Appointing the virtually unknown – to South Africans at least – Bob van Dijk to replace Koos Bekker as chief executive of Naspers was probably the best thing to do for all concerned.
There might have been those who, driven by a sense of nostalgia, would have liked to see the top position remain in South African hands.
But the reality is that the vast bulk of the value in the Naspers share price relates to assets located outside South Africa. Indeed, it relates to assets outside Africa – primarily in China.
Which perhaps begs the question: why not replace Bekker with one of the Tencent executives? That would be a sort of reverse takeover of management.
But it is not just the possibility of clashes in corporate culture that would have discouraged the appointment of a Chinese executive to the top position at Naspers.
It is surely the realisation that although Tencent is the exciting star in the Naspers firmament, it is far from the major generator of actual cash profits.
That position is enjoyed by DStv, which has performed so well across Africa that it has been able to generate huge amounts of funds that are now searching for the next “exciting star”.
There is a good chance, given the utter randomness of discovery, that the next “exciting star” will not be found in China.
Bekker announced he was stepping down to take a sabbatical and he sets off in search of that “star” next month. After a 12-month “trip” he will take up the role of Naspers chairman – assuming he does not abandon all for an ashram in Nepal.
The year’s break may have muted criticism from corporate governance experts. Moving from a position that Bekker dominated for many years into the role of chairman is frowned on – for good reason. Recall Eugene van As and Sappi.
However, even a year’s break is unlikely to be sufficient for Van Dijk to impose his stamp of authority on the group given that, in its current form, it is essentially a creation of Bekker’s.
Coronation
Coronation Asset Management, which is one of the largest institutional shareholders in Naspers, has sold off a chunk of its investment in the extremely valuable internet and media company.
A Stock Exchange News Service announcement issued yesterday by Naspers noted that Coronation had, on behalf of its clients, “disposed of a beneficial interest in N ordinary shares of the company such that all of its beneficial interest in the securities of the company amount to 4.96 percent” of the total N shares in issue.
Neither Coronation nor Naspers disclosed how many shares were sold but the latest Naspers annual report reveals that Coronation held a stake of 6.6 percent a year ago.
This suggests that Coronation may have sold just under 7 million Naspers shares. At around R1 290 a share, this sale would have generated revenue of about R9 billion for Coronation.
It is likely that Coronation is showing a substantial profit on this trade given that it is known to be a long-term investor in Naspers.
In the past five years the Naspers share price has shot up from around R200 on the back of the exceptional performance of its investment in Tencent.
In the past year alone, as sceptics warned of an inevitable weakening in the share price, Naspers’s stock has more than doubled.
The announcement of the Coronation sale comes just days after Koos Bekker said he would step down as chief executive.
In April next year, Bekker, who is the architect of Naspers’s dramatic growth, will assume the position of chairman.
Coronation has provided no explanation for its decision to sell but analysts have ventured a variety of their own, including the desire to realise some of the enormous profits that have been made in the past few years.
Edited by Peter DeIonno. With contributions from Ann Crotty.