Johannesburg - Brait SE [JSE:BAT], the Johannesburg-listed company that last week agreed to buy British healthclub provider Virgin Active, has a further $2bn (R24.3bn) to spend on deals, according to its largest shareholder and billionaire Christo Wiese.
The San Gwann, Malta-based investment company is seeking to buy businesses that are cash generative and have a proven management team, Wiese said in an interview on Thursday. He owns a 35% stake in Brait worth about $1.4bn, according to data compiled by Bloomberg,
The company agreed to pay $1bn (about R12bn) for 80% of Virgin Active, which has more than 40% of its gyms in South Africa.
“There is a very substantial war chest depending on how one goes about monetising assets or financial structures; but Brait can do some fairly sizable deals,” Wiese, 73, the fourth- richest South African with a personal fortune of $7bn, according to the Bloomberg Billionaires Index, said by phone from Cape Town.
“Another deal in the range of R20bn to R25bn is completely within Brait’s range.”
Shareholders have pressured the company to look for targets since it agreed to sell its stake in African retailer Pepkor Holding to Steinhoff International [JSE:SHF] for R26.4bn last year - South Africa’s biggest takeover in more than a decade.
Potential deals are being sought in Europe and its home market, Brait’s South Africa chief executive officer John Gnodde said by phone on April 16.
Brait shares have gained 16% this year, valuing the company at R47bn. That compares with a 10% increase on the FTSE/JSE Africa All-Share Index.
Brait’s other investments include UK-based food retailer Iceland, and Wiese said a record loss by the country’s largest grocer Tesco, valued at £18bn, may present further opportunities for investors in the industry.
Wiese is part of a group of businessmen behind Pep & Co, a British discount chain.
“I was a little bit shocked when I saw the Tesco numbers, I mean these are horrific numbers,” he said.
“We’re not actively looking at anything at the moment but one is aware of what’s happening out there and at some stage we may look.”