Africa’s most valuable company, Naspers, has stealthily become a global internet investor thanks to a stake in China’s internet powerhouse, Tencent. On 11 September, the company will list its global internet assets on the Amsterdam bourse, becoming Europe's biggest consumer internet company overnight.
This listing will signal a reminder of how Naspers’ chairman and former chief executive, Koos Bekker transformed the entity with a $32 million bet following the purchase of a stake in China’s Tencent in 2001, now worth $133 billion, making it one of the world’s most successful investments.
Now too large for South Africa’s stock market, a European listing is underway.
Naspers boasts an array of global investments in classified ads, food delivery, payments and education technology. The company’s stake in Tencent has long been worth more that the entity itself, opening up a reason for the Prosus spin off to attract international investment and help narrow the gap.
The company also accounts for a significant portion of Johannesburg’s Stock Exchange forcing investors to sell down and avoid overexposure to a single entity.
Tencent will be valued at about $100 billion as the main asset in the Prosus unit, upon the Amsterdam listing on September 11.
Amid Naspers’ euphoria, sentiments for South African investors begin to weigh in. The realities are clear. The company will list its international assets and hold about 73% of a new company, Prosus, which will help remove the outsized holding company discount to its investments, particularly its 31% holding of Tencent. It will then become available to a host of developed market investors.
The entity will be subject to a number of dramatic changes and while it seems likely that the Prosus listing will shrink the discount to the Tencent shares, investors are yet to see a guarantee that Naspers will invest its Tencent returns well.
The company’s chief executive officer, Bob van Dijk, is, however, prepared to take a leap with the food industry in response to this.
“This is probably the largest opportunity I have run into in my lifetime,” he says.
“The way people consume food will change drastically in the future. The notion that people gather a bunch of ingredients from a shop and put things together three times a day, 30 times a month…that is not the way things are going to work anymore,” he adds.
Last year, Naspers sent a 40-man taskforce to Brazil to help iFood build out a new artificial-intelligence strategy, helping companies reduce prices by predicting behavioral attitudes towards food orders.