The proposals are to make Naspers' subscriber platform subsidiaries, MIH Holdings and MIHL, wholly owned subsidiaries and have a secondary listing of Naspers American Depositary Receipts (ADRs) on Nasdaq. Naspers currently owns 42% of MIHL indirectly through MIHH.
Simplification of Naspers' corporate structure would allow investors to assess Naspers and MIHL more clearly, and would also eliminate the multiple entry points to the carious listed pyuramid companies. The secondary Nasdaq listing would enable the group to access capital markets in the US. The free float and liquidity of Naspers N shares would be improved, as would the group's funding flexibility.
The deal would give Naspers access to an estimated $220m in cash held in MIHL, including the proceeds of its stake in Open TV earlier this year.
MIH Holdings' share price has risen by 10%, to 910c, since the announcement was made, but the Naspers share price took a 5% dip to R20,50 as shareholders reacted to the proposed dilution of their holdings.
Comments Koos Bekker, chief of Naspers: "The [present] structure is somewhat inelegant. It's a pyramid structure - at the bottom is MIHL, listed on Nasdaq and then above it MIHH, listed on Johannesburg and then above it Naspers. And the same assets are really underlying all three, so we've been requested by investors to collapse it all into a single entity."
