BRIAN KANTOR: To narrow Naspers value gap, stop flinging shares and spaghetti
The market seems to think larger cash pile means more chances to destroy shareholder wealth
Naspers had a down and up week to May 17. It ended more than 5% up in rand and almost as much in US dollars. It had ended the previous week worth about R3,199, then lost about 4% on the Tuesday, only to regain 5% on the Wednesday and end the week almost unchanged. In (weaker) rands Naspers is now worth about R1.4-trillion. The reason for this renewed enthusiasm for Naspers shares was a good set of results from Hong Kong-based Tencent. Naspers has a 31.01% share of Tencent worth about R2-trillion and so Naspers rises and falls on a daily basis with the value of Tencent — though not necessarily to the same degree.That is because there is more to Naspers than its stake in Tencent. The market value of Naspers has trailed behind that of Tencent when both are measured in dollars. Tencent is up 12 times since 2010 and Naspers has added (only!) about six times to its 2010 value. Tencent and Naspers have also outperformed the S&P 500 information technology sector, which includes all the big ...
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