African Media Entertainment has made an offer to acquire financial news website Moneyweb in a deal worth as much as R29,6m. The deal, if it gets approved, will lead to Moneyweb’s delisting.
In a statement issued after markets closed on Tuesday, the companies said that AME has made an offer to buy all of the issued ordinary shares of Moneyweb, excluding a million shares already held by AME and 1,2m treasury shares held by Moneyweb.
AME’s assets include Free State radio station OFM and the Eastern Cape station AlgoaFM. Moneyweb, which founded in 1997 by business journalist Alec Hogg — he has since left the company — listed on the JSE in 1999.
The recommendations of Moneyweb’s board as well as an independent board subcommittee established to study the offer will be included in a circular to shareholders to be issued later this month.
AME has proposed a cash-based offer with a share alternative. The cash offer will be priced at 26c per Moneyweb share, while the offer to be settled in AME shares will be set at 28c per Moneyweb share.
The proposed cash offer is a 53% premium to Moneyweb’s 30-day volume-weighted average price on 8 May of 17c/share, while the share offer represents a 65% premium to the price. Moneyweb was trading 29,4% higher at 22c/share at 10.30am, after earlier touching 25c/share, a 52-week high.
The cash-based offer values the deal at R27,4m, while the share-based offer takes it up to R29,6m.
Should Moneyweb pay a dividend to shareholders prior to the completion of the deal, the offer price will be reduced by the value of the dividend. No payments or other distributions beyond “normal dividends” may be declared by Moneyweb.
Moneyweb has also agreed not to take on more debt, encumber its assets, provide any guarantees or issue new shares or share options until the deal is concluded, unless it’s with the prior written consent of AME.
Should the deal proceed, AME will seek a written undertaking from newspaper group Caxton, which holds just over 50% of Moneyweb’s equity, that it will accept AME shares rather than cash.
A scheme circular will be posted to shareholders on 29 May, with a general meeting to approve the scheme expected to take place on 30 June. All going according to plan, the deal is expected to become effective on 7 August, with Moneyweb terminating its JSE listing a day later. — © 2017 NewsCentral Media