Shoprite Holdings Ltd. shareholders will vote Tuesday on whether to approve a proposed repurchase of about 1.7 billion rand ($131 million) of shares from former Chief Executive Officer Whitey Basson.
Basson exercised a put option on May 2 that meant Cape Town-based Shoprite would buy 8.58 million shares from the ex-CEO, who stepped down as head of Africa’s biggest food retailer at the end of last year.
The original sale price of 211.01 rand a share was later reduced to 201.07 rand, the 30-day weighted average price up to when Basson decided to use his put option. At least 75 percent of voting shareholders have to be in favor of the repurchase for it to be approved.
Shoprite shares fell 0.5 percent to 222 rand at the close in Johannesburg on Monday, valuing the company at 133 billion rand.
If the deal isn’t approved, Basson should have no difficulty selling the shares to money managers over the next few months, Syd Vianello, an independent retail analyst in Johannesburg, said by phone. The stock has risen since the put option was triggered, meaning Basson could get even more cash if he sells independently.
Wiese owns about 15 percent of Shoprite’s ordinary listed shares and a further 30 percent in voting rights. The Public Investment Corp., which looks after state pensions and is the continent’s biggest money manager with assets of 1.6 trillion rand, holds about 10 percent of the company and is its second-largest shareholder.
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