JSE loses yet another listing, African Phoenix

African Phoenix joins a number of companies that have decided to delist from the JSE.
African Phoenix joins a number of companies that have decided to delist from the JSE.

African Phoenix, one of the companies formed from now-defunct African Bank Investment Limited (ABIL) after it went into business rescue, will delist from the Johannesburg Stock Exchange on Tuesday, June 30.

The company announced on Monday morning that financial services group, Legae Peresec, had acquired almost half of its shares. This has paved the way for African Phoenix to go ahead with the delisting it first proposed to shareholders in February.

The company told shareholders at the time that it was opting to delist because of "significant costs and expenses" associated with remaining listed on the JSE main board, adding that poor market ratings had been achieved by small capitalisation investment holding companies.

READ | SA lost 250 listed companies since 2000

It said its private equity strategy was best served in an unlisted environment. Even major investment holding companies, like the PSG Group and Patrice Motsepe's African Rainbow Capital, trade at a big discount to their net asset value.

In April, Legae Peresec made a firm offer to buy African Phoenix shares for 40 cents each. The group's shares have been trading at below 40 cents since early January 2020. On Monday, African Phoenix announced that the Legae Peresec's deal had been successful. "The African Phoenix shares will be delisted from the main board of the JSE with effect from the commencement of trade on Tuesday, 30 June 2020," it said.

African Phoenix joins a number of companies who have chosen to leave the JSE main board this year, including Tiso Blackstar and construction companies Group Five and Esor.

The investment holding company, whose only trading subsidiary is insurance company Stangen, decided to change its focus from being a banking group that ABIL was to become a black managed investment holding company that invests in private equities early in 2019.

The company has two other subsidiaries, Residual Debt Services Limited which is currently in curatorship, and Ellerine Holdings that has remained in business recuse since ABIL's demise in 2014.

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