Financial Consultants valued Phuthuma Nathi share price at an
average of R130.00.
You can view info here
Whilst the same analysts valued Multichoice
South Africa shares between R170.00 to R208.00 per on the 1 December
Come trading day 8 December 2011 some
unfortunate and desperate share holders cashed in shares at between
R10.00 and R13.00.
With a closing price of R25.00 on the Phuthumana Nathi 1 Platform.
We had three
Black Economic Empowerment Deals.
Five years down the line ZAR1000.00 invested is
now worth ZAR 650.00 or as little as ZAR 100.00
All three of
these deals turned bad or shall I say it was carefully orchestrated
to wipe out 35% to 90% of black investors life savings over a few
Even though your company Multichoice (Naspers) almost tripled in
value over the 5 years.
So Called "Black empowered" share value is
barely worth the paper its printed on.
Naspers was the
first to do one of these deals.
Before the launch of the Naspers Deal in 2006 they were openly
advertising amongst potential black investors that for every
R1000.00 invested they can expect a return of R31000.00, that is if
the company performed well.
(See details below direct from the Naspers
Black investors about 97% individuals made
loans from whatever source some from banks others from employers or
took life savings based on the above information (spread around the
country in community halls) took the plunged and invested.
The Reality - 5 years down the line.
are coming out of the lock period.
The the board of directors at Phuthuma Nathi decided not to list the
shares on the JSE. (this is abnormal rather strange).
No broadcasting or advertising to increase media and potential black
decided to launch there own trading platform.
They only notified share holders a few weeks ago about the
independent trading platform.
None of the share holders had any idea what the share was worth.
Proof of this was in the yearly statements they sent out to all
Bearing in mind that 98% of all share holders was individuals with
very little or no knowledge how to read a balance sheet let alone
98% of all share
holders did not cast yearly votes
As we all know only 15% of black South Africans trade on the JSE.
(45% foreign traders and the balance white South Africans)
Therefore at least 97% of all current share holders have little or
no knowledge about share trading.
Only a few share
holders was made aware of the estimated price as predicted by the
nine independent analyst. Notification was sent via email 5 working
days before trading commenced. That means that a potential 95% of
the voters had no knowledge of the fair value of the shares.
After many emails
and many months trying to persuade the directors of Multichoice to
have independent financial companies value our stock and send the
info to the share holders they refused to listen.
A few days ago they sent out emails indicating that the had
independent valuations done on the shares. None of the 120000
shareholders was notified as the majority don't have email accounts
and up till today none of them know what the true value of the
shares are worth.
They claimed that the share holders voted and gave them a yes to
proceed, but we know that 90% of share holders have no little or no
knowledge about share trading platforms.
Share holders trusted them when they said they can expect a
potential 31 times the value on investment. Share holders believed
that government and the stake holders was acting in good faith. They
trusted the system.
Proof of trader ignorance started on opening day. Average valuation
by the independent analysts was R130.00 but shares were trading at
between R10.00 and R50.00. Bearing the above in mind the share was
valued at R50.00 Five years ago.
Phuthuma Nathi Shares (Multichoice shares) have doing extremely
well, and have been performing at an average of 20% compounded over
the past 5 years. As I am writing this page the Phuthuma Nathi
shares opened on R22.00 t9 December 2011.
could not deposit money in real time we had to wait 2-3 days before
money could be cleared to our accounts. But shares was traded today.
details was incorrect on the share trading platform. Therefore
shares could not be snapped up at pennies to the pound.
Especially if you could not make a deposit in
With bank details
being incorrect (in my book this was done on purpose) you had to
hold on for hours to get assistance only to realize somebody cut you
off on the other side of the telephone line.
therefore has the right to know who bought the first +/- 5 million
Who allowed the
privy elite to electronically transfer funds 2-3 days before the
Also note that
Phuthuma Nathi 2 was trading at an average of R30 per share.(These
are investors who invested the larger sums into the scheme. Whilst
Phuthuma Nathi 1 was trading at an average of R25.00 as at 13.10 pm
on the 8 December 2011.
If any of us had
invested our money in Naspers 5 years ago at R136.00 We could have
cashed out a year ago at R409.00 providing a 300% return on
investment over 4 years. Plus full dividends. Or we could have
invested in Ten cent at +/- R20.00 per share and cashed out a few
months ago or even today @ R150.00 per share a return of 750% - 800%
I can list many other investment opportunities, instead we went with
Multichoice and Sasol, believing that these companies with such
great track records will deliver cometh the hour.
I have no doubt that the directors of the Phuthuma Nathi share
scheme purposely decided against listing on the JSE. Purposely with
held critical information from share holders. prevent public
interest. Because if they had to get media attention like they did
with the launch in 2006 the share price could have gone close to
fair share value.
They knew come December you will have a flood of cash strapped share
selling off shares and the sharks (black elite) will be lying on a
beach with laptop in hand buying up these shares at pennies to the
This is not Black Empowerment this is Minority Black Elite
Enrichment at the
expense of the poor.
Bearing in mind the interest by having 67.5 Million Shares at R10.00
= R675 Million tied up for a minimum of 5 years in a bank account.
Some of the dividends received by Phuthuma Nathi from Multichoice
was used to pay off the debt to Multichoice for the shares. Plus the
tax saving from this scheme. Naspers could claim the R40 per share
(R50 - R10) as a form a taxable expense (subject to a maximum of
R3000 per annum per new shareholder). See the info here
If you take the R11.00 that was paid through dividends, the
interest on the 675 Million plus the initial investment made by
share holders to purchase the share. The value or our input should
easily exceed R30.00 per share. The value of Multichoice almost
tripled over the past 5 years. However shares are trading at an
average of R24.50. This is criminal.
By implementing this type of scheme Naspers/Multichoice had
substantial benefit: In the end the scheme may end up costing
Multichoice nothing. They will also profit from the fact that they
are becoming a lot more BEE compliant.
An excellant deal for Naspers/Multichoice from a BBBEE viewpoint.
The Welkom Share Scheme (Media 24) have done so
badly it is now worth less than 80% of share value.
Estimated at R50.00 per share 5 years ago. Today's estimate - R10.00
Bought at R10.00 per share (5 years ago). No return on investment.
Not even the 5% that banks offer.
Investors can understand that shares will increase or decrease in
value. But surely why sell an already dying cow to investors.
Where were the financial analysts that could have guided buyers.
Sasol launched a BEE campaign at a time when the price of oil was
trading at +/-$140.00 a barrel. If you do a bit of research you will
discover that many reputable financial commentators said that the
oil bubble must burst.
Why was Sasol allowed to declare an inflated share value??
Some BEE investors bought Sasol at a supposedly discount price of
R350.00 although the share is trading at +/-R390.00 on JSE. Whilst
BEE share holders can only sell at R260.00
The shares was locked for two or three years.
That means that black investors are losing at least 35% on initial
Do any of these companies
deserve a BEE Rating?????
Where is our Government?
Where are the
people that initiated these schemes??
Why should a BEE share trade at 35%-85% less than fair value:
This is Stealing from the poor.
This incompetent bunch should be brought to justice.
A total disgrace that every single one of the above BBBEE
initiatives have failed I am sure there are many others.
Lastly SABC special assignment had a program last night about Black
Fishermen that was extremely hard done by BEE Deals. The list goes
on and on. We also know that certain black elite are enriching
themselves at break neck speed, world records are being set here in
South Africa how certain individuals have enriched themselves at the
expense of the poor. We the people, fought alongside these
individuals during the bad old days of apartheid, we are frustrated.
We are getting angry by the day. If Egypt could overthrow a corrupt
government so can we please help STOP THIS CORRUPTION.
Egyptian economy was in a pathetic state, many lives was lost, many
dreams was shattered.
Do not become
part of this problem that is silently brewing right on our doorstep.
Millions of other
Black South Africans (directly and indirectly) poured life savings
into BBBEE deals because they trusted government and all the major
Declare Share Trading on Phuthuma Nathi 1 and 2
as NULL and VOID. Close down the trading platform until further
us Unite and get 10000 investors to sign a petition and flood all
the email boxes of those concerned with our grievances. My email
Below I provide a
alternative would have been to auction Phuthuma Nathi Shares after
the lock period. (Google did this a few years ago before listing to
give the man in the street the advantage over the Old Boys sitting
at the New York Stock Exchange). With a reserve of R82.00 or
no buyers could be reached government could have stepped in and
requested that banks guarantee the shares at a minimum of R50.00 The
value that was issued 5 years ago. Bearing in mind MultiChoice
tripled in value over the past 5 years.
Was one of the
best performing stocks on the JSE even during the recession.
This would have
paved the way for cash strapped investors to make small loans.
As you may know
government has been assisting black entrepreneurs and if we take one
sector like farming, 95% failed and or the business is not
At least with the
Phuthuma Nathi shares they would have the backing of a company with
a proven track record instead of the billions that have gone to
I also understand
that banks make loans against shares from Blue Chip companies.
Omar Ebrahim -