COMPANY COMMENT: From cold shoulders to sunshine bets on Dawn
Comments suggest a glimmer of hope in the longer term for Distribution & Warehousing Network
After shares of Distribution & Warehousing Network (Dawn) beat a hasty retreat with the release of the group’s truly horrible full-year results, they perked up markedly on Wednesday.
Presumably, some punters may be betting that the terms of Dawn’s proposed sale of its 49% shareholding in Grohe Dawn Watertech (GDW) could surprise on the upside.
In the middle of 2014, Dawn sold a 51% stake in Watertech to Grohe for R880m — a sum that is now, ironically, substantially higher than Dawn’s R550m market capitalisation. Obviously, Dawn’s precarious circumstances and sluggish economic conditions mean the strength at the negotiating table lies with the buyer, especially since the company is hoping to retain master distributor status for GDW products in southern Africa. So there will be a good deal of interest in gauging the eventual price tag against the terms of the 2014 transaction.Accelerate Property Fund is banking on its flagship asset, Fourways Mall, to be its main money spinner after its overhaul is completed by the end of 2018. But the market punished the company, the share price of which collapsed about 20% in 2017. This was largely because the mall is costing the group more than expected, putting pressure on dividend forecasts. But if the shopping centre becomes the mall of choice for people living in the Fourways precinc...
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