Mergence hopes to swing a big stick with its 9% Brait stake

Business

Mergence hopes to swing a big stick with its 9% Brait stake

Investment manager’s stance towards Brait seems significantly more aggressive than that of Christo Wiese

Ann Crotty

At first glance it looks as though Mergence Investment Managers has just paid R420m to become a junior member of Christo Wiese’s control pool at Brait. The 27.3 million Brait shares purchased by Mergence lifts the investment manager’s stake to 9%.

That sounds like an excellent deal for Wiese, who is thought to be under some cash pressure in the wake of the Steinhoff implosion, but not such a good one for Mergence or the funds it manages.

A voting pool arrangement tends to be dominated by the major shareholder in that pool and minority investors struggle to secure privileges such as any influence on the underlying strategy. The Brait voting pool represents 46.35% of Brait’s shares. Wiese’s private company Titan remains the largest shareholder by a long shot with a stake of over 35%. ..

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