Koos Bekker’s share sale puzzle 

Michiel le Roux does it. Christo Wiese does it. Even Piet Mouton does it. And it’s very likely loads more do it, but they forget to disclose it.

What they’re all doing is not selling shares in their portfolio when they need cash. Instead, they use those shares as security for loans. And they avoid capital gains tax.

If you’re a director of a listed company this strategy has to be disclosed.

It doesn’t always work out well. Ask Wiese what happened when the Steinhoff share price plummeted to almost nothing back in December 2017.

But often it works out very well. Le Roux, founder and former CEO of Capitec, managed to massively increase (and diversify) his asset base by using some of his Capitec shares as security for loans. Those loans were used to acquire non-Capitec assets in a way that did not diminish his exposure to a rapidly increasing Capitec share price.

An annual event

This brings us around to what has become something of an annual event on the South African investment calendar: the Bekker family trust’s sale of 10% of its Naspers/Prosus holdings. Bekker is chair of both Naspers and Prosus, whose most important asset is a substantial investment in high-performing China-based tech stock Tencent.

In the latest move, according to an announcement from Prosus, between December 17 and December 19 the Bekker family trust sold 1.55-million Prosus N shares at an average price of about €52.50 a share. More significantly, Naspers reported that at the same time the family trust sold just under 800,000 Naspers N shares.

The Prosus sale generated €81.7m and the Naspers sale earned R860.6m for a combined rand value of about R2.5bn.

This is a little less than the R2.97bn generated by the family trust’s sale of 3.9-million Prosus shares in December 2024. It is around the R3bn the trust received for the sale of 2.5-million Prosus shares that were sold in March 2023.

It is the first time since 2014 that Bekker has sold any Naspers shares. In 2014, shortly after he stood down as CEO of the group, Bekker, who was not on the board at the time, sold 11.7-million Naspers stock for about R20bn. He was then left with 4.7-million Naspers shares.

In 2019 Bekker received Prosus shares when that company was listed out of Naspers.

IT for bricks-and-mortar

While the share price and the number of shares sold have varied a little over the past two years, one thing has remained constant. Each sale comprised only 10% of the trust’s holdings and has left the trust with 90% of the shares held before the sale.

An additional constant is the reason given for the sale. After each transaction Naspers/Prosus announced the proceeds would be used “to fund building operations at hospitality venues located in South Africa, the UK and Italy in which the family trust has an interest”.

Bekker and his wife, Karen Roos, own Babylonstoren near Franschhoek in the Western Cape, the Newt in Somerset, England, and Tuscan wine estate Vignamaggio, near Florence, Italy.

Essentially what this means is that the Bekker family trust is exchanging a fast-growing IT investment for a slower-growing bricks-and-mortar business.

No doubt Bekker has made huge sums from the sale of Naspers and Prosus shares over the years. But, given the past performance and the future performance expected from Tencent, he would likely have made even more by holding onto those shares.

So, why not go the Le Roux route and have the best of both worlds?

Naspers did not immediately respond to Currency’s query. And, of course, none of the parties involved is obliged to provide any explanations.

ALSO READ:

• Koos Bekker’s share sales: Bricks over tech?
• No letting go of Tencent, says Prosus chair Koos Bekker
• Koos Bekker’s share bonanza, and other tidbits

_{Top image: Koos Bekker and Karen Roos. Picture: Scott Olson/Getty Images.}