Caxton sells remaining stake in TMG to private equity fund Blackstar

By Asha Speckman Time of article published Mar 4, 2014

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Johannesburg - Caxton and CTP Publishers and Printers no longer held shares in Times Media Group (TMG) after it sold the remaining stake, TMG said yesterday.

Caxton sold the shares to Blackstar Group, which is a private equity group founded by TMG chief executive Andrew Bonamour.

Blackstar’s stake in TMG, which publishes the Sunday Times, has increased to 32.3 percent of the total issued share capital.

News of the liquidation comes after Business Report recently reported that Caxton’s chief executive, Terry Moolman, had lost confidence in the strategic direction of TMG, according to an insider familiar with developments in the media group.

Caxton, one of the largest publishers and printers of books and community newspapers, had pared down its holding from 11.6 percent in June last year to 7.53 percent by January this year.

Caxton sold 5.2 million shares during that period, leaving about 9 million shares.

TMG and Caxton did not respond to inquiries yesterday.

Abdul Davids, the head of research at Kagiso Asset Management said: “Caxton’s rationale for the disposal was that they wanted to increase their cash holdings. We know that TMG has renegotiated some printing contracts that will have a negative impact on Caxton.”

Paul Jenkins, Caxton’s chairman, speaking to Business Report last month, denied that there was bad blood between Caxton and TMG, saying the initial sale of 5.2 million TMG shares was a means to raise cash.

“We like cash,” he said, adding that Caxton regarded its investment in TMG just like any other investment. “We are not sentimental.”

Shares in Caxton touched R16.80 during intraday trading yesterday but slipped to close at R16.50 on the JSE, down 1.49 percent on the day.

TMG shares were untraded at R19.40.

Cheree Dyers, a director and equity analyst at Prescient Securities, said that Caxton shareholders had exited with a profit.

“They got in at fairly low levels,” Dyers added.

The TMG share price has held steady in the two years that Bonamour has been both acting chief executive and later chief executive. Under his leadership TMG has sold off non-core businesses such as Exclusive Books and Nu Metro cinemas and has also instituted several rounds of retrenchments at its media assets to cut costs.

Bonamour is now actively pursuing a strategy of buying radio stations, while Moolman’s Caxton media group maintains a large interest in printing.

TMG is a competitor of Independent Newspapers, the publisher of more than a dozen titles, including Business Report.

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