Brait Sells $540 Million of Bonds to Fund Acquisition Plan

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  • Investment company of Christo Wiese sells convertible bonds
  • Shares of FTSE/JSE Top 40 firm decline 7.9%, most in 10 months

Brait SE, the investment company controlled by Christo Wiese, South Africa’s richest man, sold 350 million pounds ($539 million) of five-year convertible bonds to fund acquisitions. The stock fell the most in 10 months.

The debt sale was oversubscribed and will carry a coupon of 2.75 percent a year, the company said in a statement on Friday. The initial conversion price was set at 7.9214 pounds per share, a premium of 30 percent above the volume-weighted average value of the shares between the start of the offering and its pricing. The shares were down 7.9 percent at 130 rand by the close in Johannesburg, the biggest drop since Nov. 25.

Brait plans to use the proceeds “for general corporate purposes with a primary focus on funding strategic acquisitions,” the San Gwann, Malta-based company said. The debt will mature on Sept. 18, 2020.

The company is diversifying its investments out of its traditional market of South Africa after raising 26.4 billion rand ($1.94 billion) in a sale of African retailer Pepkor Holding Pty Ltd. and agreeing to buy U.K. women’s clothing retailer New Look.

Bank of America Merrill Lynch and Goldman Sachs Group Inc. are joint bookrunners of the bond sale while FirstRand Ltd.’s Rand Merchant Bank and Standard Bank Group Ltd. are co-bookrunners on the deal.

Brait Shares