MARC HASENFUSS: Remgro’s smouldering returns from British American Tobacco
British American Tobacco has been one of the best performers, albeit undisclosed, in Remgro’s portfolio of investments
It’s not disclosed in Remgro’s financial results or mentioned in the investment presentations — but the investment group is still earning smouldering returns from an "oorskot" holding in British American Tobacco (BAT). The old Rembrandt group (the predecessor to Remgro) was built on tobacco, a product which these days is severely frowned upon. Remgro and Richemont, 10 years ago, officially unbundled their respective stakes in BAT with new investment company Reinet retaining a meaningful minority stake in the tobacco giant. So it might come as a surprise that Remgro still holds 1.25-million BAT shares. These shares were technically inherited — and were attached to Remgro shares repurchased and held in treasury following a share buyback exercise that preceded the unbundling of the tobacco interests in 2008. By my calculation the BAT shares are worth about R850m — bigger than some of the more marginal investments Remgro discloses in its investment portfolio. Though the value of the BAT...
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