SEKUNJALO Investment Holdings plans to aggressively expand Independent News & Media SA by launching new local titles and expanding into the rest of Africa, CEO Iqbal Survé said on Monday.
This follows an announcement on Sunday evening by the current owners of Independent News & Media SA — the South African subsidiary of Irish-based Independent News & Media — that they would sell the South African operations to a consortium headed by Sekunjalo Holdings.
Shares in Sekunjalo Holdings rose 10% on Monday after the company secured its bid.
The price tag settled on is R2bn, somewhat less than the R2.4bn-R2.8bn the debt-laden Irish media group had been hoping for.
Among the titles published in South Africa are the Cape Argus, The Cape Times, The Star and about 15 other titles.
The Sekunjalo consortium secured funding from Citibank and used their global media investment team as transaction advisers.
The parties are now preparing to meet regulatory requirements, including obtaining permission from the Competition Commission for the deal to go ahead.
Dr Survé said the consortium was a broad-based black empowerment group that included trade unions and a number of other parties from different parts of the country. Further details on the consortium will be released in about two weeks’ time.
"From what I understand, other bidders offered higher bids, but the Irish recognised ours as being the most professional and the one that could come through on the deal," Dr Survé said on Monday morning.
Among the other hopeful bidders were the owners of The New Age newspaper, the Gupta family, who initially offered about R2bn. They later increased their offer to R2.2bn but that came in too late for Independent News & Media.
Independent News & Media has a €420m debt to pay off, with the first payments due in March, and has been hard pressed to find the cash.
Its South African operations were among its most profitable assets, with Independent News & Media SA having shown an operating profit of up to 32% in previous years.
"It is a good deal. We have bought at the right time. If we had to have bought this company two years ago, we would have had to pay double the price," Dr Survé said.
He said other plans for Independent News & Media SA were to expand its electronic publishing and to increase the number of titles in vernacular languages.
"The website, iol.co.za, has more than 2.5-million unique visitors and this can be expanded upon. I would also, ideally, like to see every province having a newspaper title in the local language, such as Sepedi in Limpopo," Dr Survé said.
Regarding expansion into Africa, Dr Survé said he would like to expand into Mozambique, Angola and other Southern African countries, once the deal was finalised. "I also see a lot of opportunity on the African east coast, particularly Kenya."
The deal meant that Independent News and Media SA was "returning home", he said.
"I am an African optimist and I think the media have a very important role to play in developing the continent economically and intellectually."
Dr Survé, who developed strong ties with the ruling African National Congress during the apartheid years, said he was adamant the group’s editorial independence would be preserved.
"I am an independent thinker and I expect those who work on the newspapers to be independent too. However, I do believe that reporting should be balanced and fair," he said.
The name of the group may be changed once the deal had been completed, Dr Survé said.
At 4.42pm, Sekunjalo was up 10% to 55c.