Transaction Capital subsidiary makes R720 million sale

Transaction Capital announced today that its subsidiary, Nutun, entered into an agreement to sell Nutun Australia Holdings for AUD$58.3 million (R721.11 million).

In a SENS announcement released this morning, Transaction Capital said Nutun Investments International, a wholly owned subsidiary of Nutun International, has entered into a share purchase deed to sell its 100% equity interest in Nutun Australia Holdings.

The sale will be made to Dove Bidco, a wholly owned subsidiary of Allegro Funds, for a total sale consideration of AUD$58.3 million.

Nutun Australia Holdings is mainly involved in the business of contingency-based and first-party debt collection and rehabilitation services and other Business Process Outsourcing (BPO) services via its operating subsidiary, Recoveries Corporation Holdings (RCH).

Nutun Australia Holdings has a majority economic interest of 60% in RCH and a minority investment in Revive Financial Group. 

Nutun International, in turn, is a wholly owned subsidiary of Nutun Holdings, which provides a wide range of BPO and customer and debtor engagement services across a global client base. Nutun is wholly owned by Transaction Capital.

Allegro is an Australian alternative investment company with approximately AUD$4 billion (R49.5 billion) assets under management. 

Allegro, through its investment funds, will become the ultimate shareholder and beneficial owner of Nutun Australia Holdings after the sale is concluded.

This sale comes after Transaction Capital informed shareholders late last year that Nutun was reviewing its operations to reposition or dispose of non-core assets in line with the group’s strategy to maximise shareholder value. 

Therefore, Nutun has decided to sell its Australian business – which includes all its operations, infrastructure, and associated statutory structures in Australia, New Zealand, and Fiji – while entering into a strategic partnership with Nutun Australia and its new shareholder.

The sale will help streamline Nutun’s operating structure as the business continues to strengthen its position in the global BPO services market and scale its outsourcing services across industries and geographies, the company said.

“Transaction Capital will continue to work with Nutun to explore further restructuring to accelerate and optimise Nutun’s growth strategy,” it said.

WeBuyCars

 This sale comes at the same time Transaction Capital is unbundling its stake in WeBuyCars by listing it on the JSE in April this year.

Transaction Capital acquired a stake in WeBuyCars in 2020, buying up 49.9% of the company to take a non-controlling position for R1.8 billion. 

Since then, WeBuyCars has gone from one success to another, increasing its trading volume over ten times since the investment. 

However, Transaction Capital has come under immense pressure due to other parts of its business, particularly SA Taxi, struggling to recover post-Covid. 

This pushed the company into a corner, forcing it to sell off parts of its business to repay some of its debt.

As part of this, Transaction Capital announced it would unbundle its stake in WeBuyCars and list it separately on the JSE. 

The company aims to raise between R900 million and R1.25 billion from the unbundling. 

During the investor presentation, it was revealed that Transaction Capital would be left with no shares after the unbundling. 

The founders would be left with a 10% ownership stake – down from their current 25.1% shareholding.