Allan Gray makes Alex Forbes wait

JOHANNESBURG – Alexander Forbes postponed at the last minute the special meeting on Wednesday where shareholders would have voted on the proposed purchase of the company by a private equity consortium for R8,8 billion.

The postponement was the result of objections by some shareholders, particularly investment manager Allan Gray, which described the consortium’s offer price as too low. The private equity consortium recently raised its offer from R16,25 to R17 a share, valuing the company at N$8,8 billion.Wednesday’s meeting of shareholders was adjourned with a deadline of April 30 to allow the consortium to discuss with shareholders the possibility of reinvesting in the company after the deal is completed.Allan Gray said it would not sell the Alex Forbes shares it held on behalf of its clients if the Actis-led consortium did not raise the offer price.Duncan Artus, a portfolio manager at Allan Gray, said that if the purchase price was not improved, a reinvestment option would be the best alternative.The asset manager has increased its shareholding in Alex Forbes in the past 18 months and now owns about 20 per cent of the country’s leading pension fund administrator.The Actis-led consortium said it was “extremely unlikely” that the offer would be raised.Actis partner John van Wyk said: “We think it’s a full price, but value is in the eye of the beholder.”A reinvestment option might require creation of a listed entity that would hold investments in Alex Forbes.But the option was being explored to ascertain whether it would be practical.”The pension fund administrator would be better off as it was,” Van Wyk said.Rothschild South Africa chief executive Stephen Gorven said that when local investors held out, it reflected that they were still adjusting to the “invasion of private equity”.The air could have been clouded by the company’s legacy issues.Shortly after Peter Moyo became the chief executive last year, it took a R480 million charge for failing to pass benefits to its clients after it lumped their money for better interest rates.Alex Forbes shares rose 1,54 per cent to R16,45 on Wednesday, while the non-life insurance sector added one per cent.Business ReporterThe private equity consortium recently raised its offer from R16,25 to R17 a share, valuing the company at N$8,8 billion.Wednesday’s meeting of shareholders was adjourned with a deadline of April 30 to allow the consortium to discuss with shareholders the possibility of reinvesting in the company after the deal is completed.Allan Gray said it would not sell the Alex Forbes shares it held on behalf of its clients if the Actis-led consortium did not raise the offer price.Duncan Artus, a portfolio manager at Allan Gray, said that if the purchase price was not improved, a reinvestment option would be the best alternative.The asset manager has increased its shareholding in Alex Forbes in the past 18 months and now owns about 20 per cent of the country’s leading pension fund administrator.The Actis-led consortium said it was “extremely unlikely” that the offer would be raised.Actis partner John van Wyk said: “We think it’s a full price, but value is in the eye of the beholder.”A reinvestment option might require creation of a listed entity that would hold investments in Alex Forbes.But the option was being explored to ascertain whether it would be practical.”The pension fund administrator would be better off as it was,” Van Wyk said.Rothschild South Africa chief executive Stephen Gorven said that when local investors held out, it reflected that they were still adjusting to the “invasion of private equity”.The air could have been clouded by the company’s legacy issues.Shortly after Peter Moyo became the chief executive last year, it took a R480 million charge for failing to pass benefits to its clients after it lumped their money for better interest rates.Alex Forbes shares rose 1,54 per cent to R16,45 on Wednesday, while the non-life insurance sector added one per cent.Business Reporter