PROSY - Prosus Finally Admits the Obvious; Will Buy Back Shares at Half Price
One of the more striking market phenomena today is the existence of large conglomerate discounts. Several prominent companies that have many different business lines or stakes in other companies often trade at a discount to the value of their assets -- even if some of those assets have readily identifiable public market values.
Perhaps no case has been more extreme than that of European venture investor Prosus (OTC: PROSY) and its majority owner, South African media conglomerate Naspers (OTC: NPSNY) . Naspers is known for being a 31% owner in Chinese giant Tencent (OTC: TCEHY) , but also has ownership stakes in other internet classifieds, food delivery, and fintech businesses in emerging markets and Europe.
Naspers has long traded at a discount to the value of its Tencent stake alone. To close the gap, Naspers spun off 27.5% of these international investments into a separate company called Prosus in Sept. 2019. It listed Prosus in Europe to tap a bigger market for its stock.
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Prosus Finally Admits the Obvious; Will Buy Back Shares at Half Price