Listed private equity investing company Stimulus Investment Limited has sold its stake in the printing equipment supplier Nashua Namibia after close to two decades of being a shareholder.
This is part of Stimulus’ disinvestment in some companies as it plans to have gotten out of major deals by 2026.
In a recent financial accounts update, the company also sold 17,6% of its interest in Khomas Solar Saver to its fellow shareholder, Sedgeley Solar Management.
Both now hold 50%.
According to the accounts update, the Nashua and Khomas Solar deal brought in some N$75,2 million, which was paid out as a special dividend to the 2011 Preference Shareholders during December 2022.
Established in 2004, Stimulus has held equity in local privately owned companies such as Plastic Packaging, the Solar Saver Group, Neo Paints, the Namibia Media House Group, Polyoak, and Walvis Bay Stevedoring.
At the end of February this year, Stimulus assets under management amounted to N$651,1 million, and the investee companies employed 1 264 permanent employees and 766 temporary ones.
These assets returned about 13,6% as an annual return to investors, which include the Government Institutions Pension Fund.
The company’s dividend income from investee companies reduced by 11,2% to N$17,4 million (2022: N$19,6 million), which it said was mainly due to the retention of capital within two key portfolio companies for expansionary purposes.
“The reduction in dividends is offset by an increase in the fair value of the investment portfolio as most of the portfolio companies are reaping the benefits of operational efficiency improvements in combination with a pickup in demand in certain industries, following the recession of the past few years,” reads the commentary.
Stimulus declared a final preference share dividend of N$0,76 per preference share (2022: N$2) on 29 May.
This dividend, together with the special dividend of N$16,16 per preference share paid in December 2022 and the most recent portfolio valuations, resulted in a total return to preference shareholders of 13,6% (2022: 1,9%) for the year.
Commenting on the results and performance, executive team member Pieter Laubscher said the company was pleased to note that the portfolio companies are starting to benefit from their operational efficiencies in combination with the pick-up experienced in certain industries.
“We remain positive regarding the Namibian economy’s prospects in the medium term, also taking into account Namibia’s positioning around green hydrogen, as well as the offshore oil reserves, which are starting to look like a very real prospect.
“Last year, we mentioned that the Stimulus Board would carefully start evaluating certain exit opportunities. In this regard, we are pleased to report the two divestments made.
“We also believe that the terms at which these disposals were made underpin and inform the value of the remaining portfolio,” he said.
Stimulus has grown from being the first Namibian private equity fund to one of the largest due to the combination of patient capital and an experienced, long-standing management team, he said.
The Stimulus portfolio delivered dividend payments to its preference shareholders totalling N$84,5 million (2022:N$9,6 million) for the year under review, which increased by 777% from 2022.
This, in combination with the latest portfolio valuations, represents a total return to preference shareholders of 13,6% (2022: 1,9%) for the year.
The substantial increase in dividends is largely due to the proceeds from the investment disposals of N$75,2 million.
Email: lazarus@namibian.com.na
Twitter: @Lasarus_A
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