Reinet extends share buyback programme to more than R2bn

Reinet, the investment firm controlled by the Rupert family that owns a valuable stake in British American Tobacco (BAT), says it plans to spend another €44m (R738m) on share buybacks.

Between November 2018 and the end of May, the group spent about R1.5bn on two share-repurchase programmes – a strategy aimed at returning value to shareholders by boosting metrics such as dividends per share.

Some shareholders previously urged Reinet to sell down its BAT stake and repurchase its own stock, which has been trading at a hefty discount to net asset value (NAV).

Reinet’s shares have risen 14.5% since the first buyback programme started on 20 November 2018. 

The firm said on Friday it planned to spend €44m under its third share buyback programme ending in August.

“The purpose of the programme is to return value to the shareholders of the company,” it said, adding that it may use the shares as consideration for acquisitions.

“Concurrently, the Rupert family has declared its intention not to sell any shares during the duration of this programme,” Reinet said.

In May, Reinet said an increase in the value of its stake in UK insurer Pension Corporation had partially made up for BAT’s share decline.

Reinet’s net asset value of €4.8bn at the end of March was 5.8% lower than a year before, the company said at the time.

This mainly reflected the decrease in the share price of BAT to £31.94 from £41.31 over the period, said Johann Rupert, the chair of Reinet.

hedleyn@businesslive.co.za