This will give eMedia Holdings (EMH) independent and complete control over eMedia Investments’ long-term strategic direction, and improve the liquidity of EMH’s shares.
eMedia Investments (EMI) controls the following firms: E-tv, Platco Digital, E-sat TV, Yired, SASANI Studios, and eMedia Properties. Platco Digital operates eMedia’s satellite service Openview.
EMH is listed on the Johannesburg Stock Exchange and is ultimately solely controlled by Hosken Consolidated Investments (HCI).
The Commission noted that EMH and HCI have investments in various firms active in several industries, including hotel and leisure, media and broadcasting, transport, energy, services and technology, and property.
Meanwhile, eMedia Investments is jointly controlled by EMH and VenFin, a holding company formed in 2000 as part of the Rembrandt Group’s restructuring.
During the restructuring, technology investments were held by Venfin, while traditional investments remained with Remgro.
Remgro is a South African, JSE-listed investment holding company with interests in the healthcare, consumer products, insurance, industrial, infrastructure, media, and sports sectors.
“The Commission is of the view that the proposed transaction is unlikely to substantially lessen or prevent competition in any market as it is an internal restructuring,” the Competition Commission said.
“The proposed transaction does not raise significant public interest concerns.”
In a circular explaining the deal, eMedia said that EMH holds the majority of the shares (approximately 67.69%) in EMI, its operating subsidiary, while Venfin holds the remainder.
Under the terms of the deal, Venfin will receive shares in EMH in exchange for its EMI shares, which it must then immediately distribute to Remgro shareholders.
If Venfin or Remgro fails to distribute the shares, EMH has the right to repurchase the shares from either party for an aggregate cash consideration of up to R59,509,547.50.
“The proposed transaction will materially enhance EMH’s scale by consolidating 100% ownership of EMI under the listed entity, and ensure that EMH has independent and full control over EMI’s long-term strategic direction,” it said.
“In addition, for an extended period of time, there has been limited liquidity in the listed EMH N Shares.”
eMedia said that the transaction would create a significantly larger percentage of the EMH N shares held by public shareholders, creating additional free float and liquidity.
