Marc Hasenfuss Editor-at-large

The small-cap malaise on the JSE could not be better illustrated than by the market looking past developments at Stellar Capital Partners (SCP). SCP trades at a hefty 45% discount to its updated sum-of-the-parts value of 110c a share. This might be viewed as "fairly normal" for a small investment company — except that SCP is in the throes of selling off its major investments, most notably industrial supplies group Torre and electronic security specialist Amalgamated Electronic Corp (Amecor). Last week SCP also detailed a transaction in which it sold off the bulk of its 49% stake in financial services group Prescient for R384.5m cash — equivalent to about 35c a share. One could safely assume that SCP will garner about R300m when the Torre buyout offer is executed, and perhaps R400m for Amecor. That means more than R1bn should be rolling in at SCP in the near term — an amount that comfortably covers the preference share liability of R576m and other debt. Conservatively, including cash...

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