The group has made bigger borrowings in foreign countries where most of its investments are located.
Reinet also entered into a £500m (R8.48billion), medium-term financing arrangement with Merrill Lynch International, which runs until 2022 in January.
The amount of investment available at its disposal allows the group to invest in listed and unlisted companies globally.
The group has a number of investments including the 68.1 million shares in British American Tobacco (BAT), which represents 3.7 percent of BAT’s issued share capital.
The shareholding in BAT, as well as other investments, was enough to influence the net asset value (NAV) of Reinet during the first quarter to the end of June.
“The decrease in the net asset value of 182m (R2.76bn) during the period is influenced by decreases in the estimated fair value of certain investments, including BAT, Pension Insurance Corporation Group and US land development and mortgages,” the group said.
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Reinet Investments was created after the restructuring of Richemont, the Swiss luxury goods business. Its goal is to provide shareholders with an investment vehicle which will manage their funds in a conservative manner.
However, in the year results to end March, the group reported that its NAV increased 15 percent during the year, to 6bn as compared with 5.22bn the previous year.
The group said the value of its investment in BAT amounted to 4.06bn at the end of June, down from 4.25bn at the end of March, about 70percent of Reinet’s NAV.
The decline in Reinet NAV was also influenced by BAT share price on the London Stock Exchange. BAT’s share price decreased from £53 at the end of March to £52.34 at the end of June. The group said this resulted in a decrease in value of 51m.
Other investments in Pension Corporation declined slightly during the quarter. The estimated fair value of investment was 1.17bn at the end of June, down from 1.18bn at the end of March.
The investment in Trilantic Capital Partners is carried at the estimated fair value of 209m at the end of June was slightly up as compared to 202m at the end of March.
BUSINESS REPORT ONLINE