SIGNIFICANT international equity funding was secured in online bank TymeBank, which launched publicly in February 2019, and TymeGlobal’s portfolio value increased by 14.1 percent to R14bn. | Reuters
AFRICAN Rainbow Capital Investments (ARC), which has investments in tech disruptors such as mobile data company Rain, and TymeBank, lifted intrinsic net asset value 16.6 percent in the six months to December 31 to R8.85 a share.
As an indication of the improved position, at the same time a year before, the intrinsic net asset value of billionaire Patrice Motsepe’s main investment vehicle had fallen 7.6 percent.
The share price surged 6.37 percent to R6.18 yesterday morning. The price indicates the share is trading at about a 30 percent discount to the company’s valuation of its investments - the discount is much less than previous years though.
Cash in hand nearly doubled to R538 million. Debt in the fund increased by 8.6 percent to R944m.
ARC invested an additional R56m in Rain and its shareholding value increased to R3.37bn from R3.3bn in June 2021.
Rain participated in the radio spectrum auction that started on March 8 and secured two allocations of 10MHz of the spectrum in the 700 MHz band, and for 10MHz of the 2.6GHz band respectively, for R1.15 billion.
Following the finalisation of the Opt-In round, telecom regulatory body Icasa had started the main-stage spectrum auction, but the outcome of this is still unknown.
ARC said Rain was on track to exceed its budgeted R1 billion earnings before tax, interest, depreciation and amortisation, for the year to end-February 2022, having achieved breakeven for the first time in the last 12 months.
It was likely to continue to benefit from developments in its operating environment and strong demand for its products, in spite of many employees returning to their offices.
Rollout of 5G coverage was progressing well.
Rain’s valuation for December 31 was unchanged due to delays in the spectrum auction and uncertainty regarding the timing, cost and size of additional spectrum being allocated to Rain.
At Kropz Plc, a phosphate mining company, significant progress had been made at Elandsfontein and construction of the concentration plant was completed.
The Kropz valuation increased following the commissioning of Elandsfontein and an updated feasibility study.
Significant international equity funding was secured in online bank TymeBank, which launched publicly in February 2019, and TymeGlobal’s portfolio value increased by 14.1 percent to R14bn.
Some 8.4 million Afrimat shares were sold for R496m, leaving ARC with a 10 percent shareholding.
ARC said the operating environment for most of the companies in the portfolio remained largely challenging, as an already poorly performing economy was exacerbated by the impact of the pandemic.
The company’s intrinsic investment value in the ARC Fund increased by 16.8 percent from R11.54bn at June 30, 2021 to R13.48bn at December 31.
The ARC Fund made acquisitions and disposals amounting to R327m and R632m respectively during the period.
ARC Financial Services Holdings (ARC FSH) acquired 37.33 percent of fintech Crossfin for R415m resulting in the ARC Fund’s indirect interest of 19 percent and R207m respectively.
ARC FSH injected an additional R257m into TymeBank and TymeGlobal as part of the capital requirements for the bank. At December 31, the ARC Fund had a 25 percent interest in TymeBank.
TymeBank maintained momentum in the number of bank accounts being opened, active accounts and launching new products.
The value of ARC FSH’s investment in TymeBank increased to R2.83bn, representing a 20 percent valuation uplift.
ARC Investments invested R64m in the ARCH Cold Chain Solutions East Africa Fund.
ARC Financial Services Investments (ARC FSI), which owns 39.9 percent of Alexander Forbes Group Holdings, saw its investment increase from R767m at June 30 to R936m at December 31.
BUSINESS REPORT