Independent in the bag for Sekunjalo

A consortium led by Sekunjalo group chairman Iqbal Survé is believed to have won the bid to buy Independent News and Media SA.

An agreement is thought to have been signed on Friday.

The Sekunjalo consortium initially bid between R2.3-billion and R2.4-billion for Independent Newspapers SA but reduced its offer after completing adue diligence exercise.

The Sunday Business Post quotes the offer price as between à160-million and à170-million, well short of the à240-million to à250-million first flagged for the sale.

After agreement is reached it will take several months to get regulatory approval and the parent company, the Irish-based Independent News and Media group, will still be left with debt of about à270-million.

The South African assets of Independent News and Media group have long been among its most profitable, with South African assets accounting for a third of group revenue and half its operating profit.

Independent News and Media SA's titles include The Star, Cape Argus, Isolezwe, The Mercury and Pretoria News.

Independent News and Media has been trading under highlevels of debt and has restructured over the past few years, including selling off its flagship UK title, The Independent.

It was trying to sell off South African assets to relieve some of the debt. The offer has been underwritten by a global investment bank, sovereign wealth funds from the Middle East, and South African pension funds.

Survé is well connected. He is the co-chairman of the Saudi Arabia-South Africa Business Council and is involved with the World Economic Forum.

Sekunjalo is one of the 333 businesses in the forum's Global Growth Companies community. The JSE-listed Sekunjalo is not involved in the bid for Independent News and Media SA. The bidder is the privately owned Sekunjalo Holdings.

Though sources say the bid was several hundred million lower than those of competitors, it was the only group that had completed an extensive due diligence examination and had a firm offer on the table.

The Sekunjalo consortium, which is said to include two labour unions, was advised by Citibank and technology teams from the US and Canada.

The plan is to grow assets locally and elsewhere in Africa.

One bidding group included the non-executive chairman of Gijima Group and billionaire Robert Gumede, along with former ANC treasurer-general Mathews Phosa, backed by the China Africa Development Fund, with a bid of about R2.5-billion.

The Blueprint Group, led by advertising executive Groovin Nchabeleng, put in a bid of about R2.4-billion backed by HSBC.

The politically well-connected Gupta family is believed to have obtained financial backing for the potential bid from The Times of India and a TV group in that country.