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We take a look at a SENS announcement released by the JSE group in which it announced its buying a majority share of Link SA for a consideration of R224 million
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About JSE (JSE)
The Johannesburg Stock Exchange (“JSE”) located at 1 Exchange Square, 2 Gwen Lane, Sandton, Johannesburg, South Africa. The JSE offers secure, efficient primary and secondary capital markets across a diverse range of securities, supported by our post-trade and regulatory services. We are the market of choice for local and international investors looking to gain exposure to the leading capital markets in South Africa and the broader African continent. The JSE is currently ranked the 19th largest stock exchange in the world by market capitalisation and the largest exchange in the African continent.
Statement released by the JSE on 26 August 2019
Shareholders are advised that the JSE has agreed to acquire 74.85% of Link Market Services South Africa Proprietary Limited ("Link SA") from Link Market Services Limited, a company incorporated in Australia ("Link Australia"), being the entire shareholding held by Link Australia (the "Proposed Transaction"), subject to the required regulatory approvals. Link SA is the second largest share register business in South Africa, and has a client base that includes six of the top 40 issuers.
The Proposed Transaction supports the JSE's strategy to strengthen its relationships with its issuers and to grow sustainably across the issuer services value chain. The Proposed Transaction will result in the JSE holding 74.85% in Link SA with Link SA's Black Economic Empowerment (BEE) partner retaining its existing 25.15% in the company. Iqbal Haniff will remain as CEO of Link SA, and the company will retain its level 2 BEE rating post the transaction. The consideration of R224.5m for the 74.85% stake in Link SA will be paid from the Group's cash reserves.
The Proposed Transaction is revenue accretive with an expected contribution of approximately 6% of Group revenue, while exceeding the Group's return on investment hurdles. The Proposed Transaction is expected to close by 31 December 2019, subject to the required approvals being obtained. The information provided in this announcement has not been reviewed by the Group's external auditors.
The Proposed Transaction supports the JSE's strategy to strengthen its relationships with its issuers and to grow sustainably across the issuer services value chain. The Proposed Transaction will result in the JSE holding 74.85% in Link SA with Link SA's Black Economic Empowerment (BEE) partner retaining its existing 25.15% in the company. Iqbal Haniff will remain as CEO of Link SA, and the company will retain its level 2 BEE rating post the transaction. The consideration of R224.5m for the 74.85% stake in Link SA will be paid from the Group's cash reserves.
The Proposed Transaction is revenue accretive with an expected contribution of approximately 6% of Group revenue, while exceeding the Group's return on investment hurdles. The Proposed Transaction is expected to close by 31 December 2019, subject to the required approvals being obtained. The information provided in this announcement has not been reviewed by the Group's external auditors.
Share Price Performance of JSE (JSE)
The screenshot below, taken from Sharenet shows the share price history of JSE for the last three years as well as the share price performance over various time periods
The summary below shows the performance of JSE's share price over various time periods:
- 1 week: -1.45%
- 1 month: -9.39%
- Year to date (YTD): -28.28%
- 1 year: -23.55%
- 3 years: -28.37%
- 5 years: 18.86%