Thriving PSG has no plans to chase big new opportunities
Solid results from investment house, which says it has enough on its plate for now
PSG Group, the Stellenbosch-based investment house, is unlikely to chase sizable new opportunities in the short to medium term.
Speaking after the release of year to end-February results on Tuesday, CEO Piet Mouton said PSG had enough on its plate following the recent listing of private tertiary education business Stadio Holdings, building up power management venture Energy Partners and the recent acquisition of a majority stake in retirement village developer Evergreen.
Mouton said PSG was excited with progress at Evergreen. “They have already purchased the land that will see the company shift from 540 units to over 5,000 units in the next five years,” he said.
While there was no shortage of available capital for Evergreen, the business showed that it recycled capital quickly in its projects.In 2017 PSG investment subsidiary PSG Alpha snagged a 50% interest in Evergreen for R675-million — one of the biggest initial cash investments in its 22-year history.
PSG’s main investment is Capitec Bank, which accounts for 51% (2017: 47%) of the total sum-of-the-parts (SOTP) valuation. The group also holds major stakes in other JSE-listed counters such as private schools specialist Curro Holdings, agribusiness investor Zeder (which holds major stakes in listed companies like Pioneer Foods, Kaap Agri and Quantum Foods), and wealth management group PSG Konsult.
Mouton said PSG’s existing core businesses were all well positioned for further growth. “We remain positive about investing in SA and PSG Group’s investment portfolio is well positioned to continue yielding above-average returns.”
The group’s investee companies were well capitalised. “This bodes well for future growth, particularly for when there is an uptick in the economy,” he said.
There was a final dividend of 277c per share (2017: 250c per share). This brought the total payout to 415c per share, an increase of 11% over 2017’s 375c per share.