Interest in MWEB
NASPERS’ share price rose again yesterday after the announcement a day earlier of the group’s plans to auction its local internet service provider (ISP) subsidiary MWEB.
Naspers has been very busy over the past few months disposing of businesses which do not fit its strategy.
For example, last week Naspers announced the sale of its Reader’s Digest magazine business to the Australian publisher of the magazine. And in April, Naspers said it would sell its Greek and Cypriot pay TV unit NetMed to the Greek telecoms company Forthnet.
The decision to sell MWEB must have been especially difficult because Naspers spent time and money bringing the ISP into the black.
These announcements indicate a healthy and aggressive Naspers that seems dedicated to achieving its strategy, which is to focus on online content, communities and commerce.
Judging from the tenor of the MWEB announcement on Monday, Naspers already has a fairly good idea who wants to buy MWEB.
Some analysts speculated that Altech or Dimension Data’s Internet Solutions subsidiary may be the acquirers, but MWEB is big enough to warrant a cautionary and the listed companies haven’t issued one yet.
MWEB has a valuable African business that should be able to upscale quickly with new capital, while its South African market share could be an invaluable bolt-on for any network operator. Significant cost savings and synergies should easily be extracted from such a deal.
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