Shares in technology and media giant Naspers came under selling pressure late on Friday afternoon after it announced plans to raise as much as US$2,5bn (about R36bn) through a capital-raising exercise.
Shares in Naspers were trading down by almost 4% shortly before markets closed in Johannesburg for the weekend.
The group said the plan to raise the fresh capital follows its announcement on 23 October that it would increase its stake in Avito, the largest classifieds website in Russia, from 17,4% to 67,9% for a cash consideration of $1,2bn.
“At the time we noted that the transaction would not materially increase our existing debt profile in the medium term. Therefore, we are considering a capital raise of up to $2,5bn which, including the Avito acquisition, will enhance financial flexibility over the next few years to invest in attractive growth opportunities,” Naspers said.
Any capital raise is expected to be within existing shareholder authorities, it added.
Naspers has appointed Citigroup and Morgan Stanley to advise it.
The group, meanwhile, also reported its interim results for the six months ended 30 September 2015 on Friday.
Consolidated revenues of R37,8bn grew by 10%, driven by good growth in the e-commerce segment. Internet revenue now accounts for 64% of the group total, up from 60% a year ago. Businesses outside South Africa now contribute 75% of revenues, up from 71% a year ago.
Consolidated development spend declined by 13% year on year and by 32% compared to the second half of 2015.
Reduced development spend in the classifieds and the digital terrestrial television businesses was offset by investments in new areas, notably ShowMax, mobile-only classifieds (Letgo) and travel in India, it said.
Trading profit grew by 34% to R15,3bn on the back of solid earnings contributions from Tencent, South African video entertainment (mainly MultiChoice) and the Allegro marketplace, it said. — (c) 2015 NewsCentral Media
