South Africa

Trading Day – Grand Parade receives a buy-out offer

Grand Parade Investments (GPI) received a buy-out offer from GMB Liquidity Corporation after it acquired a 35% stake in GPI.

It triggered a mandatory offer at a price of R3.33 per share from GMB Liquidity Corporation.

Gold Fields’ share price surged more than 20% yesterday after the termination of the Yamana deal.

US markets are down in anticipation of the release of the CPI inflation report today. The S&P 500 closed 2.1% lower, and the Nasdaq is down 2.5%.

The Nikkei 225 is down 1% in early morning trade, while the Hang Seng index declined 1.8%.

Here is the biggest news of the day.

  • Meta is laying off more than 11 000 employees. The company is laying off 13% of its staff after the shocking growth in company expenses in its latest results sparked a sell-off in shares of over 20%. They are also taking a number of steps to cut discretionary costs. Meta’s share price climbed 5% yesterday following the news.
  • Grand Parade Investments (GPI) received a buy-out offer from GMB Liquidity Corporation. Last month GMB snapped up nearly 28% of GPI and had since increased its stake past 35%. This triggered a mandatory offer at a price of R3.33 per share. GMB is a subsidiary of GMB Investments (GMBI), where the sole director is Gregory Bortz. GMB has also recently made an investment in horse racing in the Western Cape by financing Kenilworth Racing. GMB does not intend to apply for the delisting of GPI from the JSE, but GPI originally had plans to delist after disposing of its assets to unlock value for shareholders.
  • Gold Fields’ share price surged over 20% yesterday after the Yamana deal was terminated. In total, the shares have risen nearly 35% in the last week as the deal’s demise unfolded. Gold Fields will receive a $300 million termination fee, half of which is to be paid by rival bidder Pan American. Gold Fields originally bid $6.7 billion in an all-share transaction for Yamana in May, but a drop in Gold Fields’ share price caused the deal value to wane to $4 billion. Pan American, in conjunction with Agnico Eagle Mines, offered $4.8 billion as a combination of cash and shares for Yamana. Gold Fields CEO Chris Griffith said that they were disappointed but pleased that they stuck to their disciplined financial strategy.
  • Tesla’s share price fell 7% yesterday after it emerged that Elon Musk had sold nearly $4 billion worth of Tesla shares to further help finance the Twitter acquisition. The share price is now near a 2-year low.