HCI said yesterday it had increased its beneficiary interest in Tsogo Sun securities by 7.75percent, taking its total shareholding to 51.18percent in the company.
While Tsogo Sun’s share price jumped on the JSE after the announcement and recorded an eight-month high of R25.57 a share, HCI’s share price went the opposite direction, declining by 0.69percent to close at R143.50 a share. Tsogo Sun shares closed 0.92percent up at the end of the day at R25.35.
Nolwandle Mthombeni, an investment analyst at Mergence Investment Managers, said the biggest implication of this was that HCI, upon consolidation of financial results, would have a higher attribution of earnings from Tsogo Sun.
“This means HCI’s share of Tsogo Sun earnings will be higher going forward. Another implication is that they now have a more significant blocking stake in terms of any resolutions that need to be voted on at meetings with the shareholders,” Mthombeni said.