South African tech billionaire lost R3.6 billion in a week

South African tech billionaire Zak Calisto, who founded Cartrack and Karooooo, lost R3.6 billion in a week after announcing plans to sell 1.5 million of his personal shares.

The share sale was made through underwriters, and the shares were not publicly traded. However, they will become public through the underwriters.

The sale was structured as a guaranteed public offering of 1.5 million shares, with a 30-day call option for an additional 225,000 shares at $50 per share.

On 11 June 2025, the day before the announcement, the closing share price of Karooooo was $59.53 on the Nasdaq and R1049.99 on the JSE.

The share sale price was, therefore, well below the trading price. This is due to liquidity reasons, where there is a risk of being unable to convert an asset to its paper value.

Before the share sale, Calisto owned 19,417,958 Karooooo shares, which traded at R1,039.81 and were worth around R20.4 billion.

However, following the announcement of Calisto’s planned share sale, Karooooo’s share price plummeted, affecting his wealth in two ways.

Firstly, by selling his shares at $50 each, well below the trading price before the announcement, Calisto lost R252 million from realising his 1.73 million share position.

Secondly, since the announcement of the public offering, Karooooo’s share price fell from $59.53 per share to $47.34 per share.

This means that Calisto’s remaining 17.7 million shares have lost R3.4 billion since the public offering was announced.

This means that the total value from the sale proceeds and remaining shares is worth R16.8 billion. Calisto therefore lost R3.6 billion since the announcement of the public offering.

The table below provides an overview of the effect of the share sale on Calisto’s wealth over the last week.

Analyst opinion

Roy Mutooni, a portfolio manager and analyst at Sanlam Investments, explained that Karooooo is a software-as-a-service stock many investors like.

After moving the company to the Nasdaq stock market as its primary exchange, with a secondary listing on the JSE, the valuation increased significantly.

This high valuation was partly driven by the stock’s low liquidity and high demand, pushing the share price. “He let the valuation run on the back of the liquidity premium,” Mutooni said.

He said the latest placing was significant, which is why the price went down. “The price came in at a discount, and after that, the market price came down as well,” he said.

Despite the decline in share price, Mutooni argued that Calisto addressed a long-standing market complaint of low liquidity.

Shane Watkins, a director at All Weather Capital, agreed with Mutooni, saying Karooooo’s high valuation was a function of the free float.

“The free float was restricted, which means you do not have good price discovery. A significantly bigger free float would help us to see what the company is worth,” he said.

The chart below shows the Karooooo share price, in USD, and trading activity before and after the announcement.

Zak Calisto’s path to becoming a billionaire

Zak Calisto was born in Portugal but moved to Mozambique with his family when he was two. They later moved to South Africa.

After completing school, he began studying actuarial science at the University of Witwatersrand. However, he later dropped out.

After compulsory military service, he completed an accelerated training programme at Standard Bank. This was when he decided to go into business.

He started as a distributor for Netstar and later helped the company expand into South Africa’s neighbouring countries.

In 2001, he launched Cartrack as a joint venture with Netstar. However, the partnership did not work out for Calisto, prompting him to go alone.

In 2004, he struck out on his own with Cartrack, a stolen vehicle recovery company in South Africa. Since then, it has grown into a multinational powerhouse.

Cartrack was listed on the JSE in 2014 and delisted in 2021 to launch on the Nasdaq under a holding company, Karooooo.

Today, Karooooo is a global technology heavyweight headquartered in Singapore. It offers tracking, data analytics, and business intelligence.

On Wednesday, 14 May 2025, Karooooo released its fourth quarter 2025 financial overview, which was another set of strong results.

Cartrack subscribers increased 17% to 2,302,236, with net Cartrack subscriber additions increasing 25% to 79,009.

Karooooo’s subscription revenue increased 16% to R1.086 billion, and Cartrack’s SaaS annualised recurring revenue increased 17% to R4.384 billion.

Karooooo’s operating profit increased 30% to R385 million, and earnings per share increased 19% to R8.11.

“The 2025 financial year was a period of strong execution, impactful innovation and significant progress,” said Calisto.

“We accelerated customer acquisition, enhanced our platform with more advanced AI Video capabilities and other features, and successfully launched the Cartrack-Tag.”

He said they remained optimistic about continued healthy organic growth in South Africa, while their investments in Europe are expected to drive accelerating subscriber growth.

“Southeast Asia continues to represent our largest medium-to-long-term growth opportunity, and we are excited about our progress in the region,” he said.

Karooooo’s constant currency subscription revenue growth increased 31% in Southeast Asia in Q4 2025. 

“Our culture of innovation, disciplined execution, and customer centricity give us confidence as we aim to accelerate our growth in FY 2026,” he said.