Preference share investors in the holding company of the old African Bank, which renamed African Phoenix Investments Limited started trading again last week on the JSE, are in a pickle. The ordinary shareholders in the business have their hands tightly around their throats. In better days, the preference shareholders had contributed R1.13bn of capital to what was then a bank holding company. Now, the decision on whether to pay that back is entirely in the hands of ordinary shareholders. The company has value, providing some relief to the shareholders who thought they lost everything when the bank collapsed in September 2014. The ordinary shares traded on Friday at 45c, a premium on the 31c it last traded at before being suspended from the JSE — though a fraction of the R39 a share peak reached in 2012. That closing price gives the company a market capitalisation of R675m.The preference shareholders, who would normally rank ahead of ordinary shareholders in a liquidation and therefor...

Subscribe now to unlock this article.

Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).

There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.

Cancel anytime.

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.