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<\/a><\/p>\nWhile that will be reduced when the company spins off its Tencent stake and other internet-focused assets into a new vehicle listed in Amsterdam next month, its 73% holding in that entity, known as NewCo, will only cut its weighting in Johannesburg by about a quarter, according to Naspers. Furthermore, Naspers and NewCo are both reliant on the Tencent investment, which is worth more than the company as a whole.<\/p>\n
Tencent has been struggling with a Chinese government crackdown on addiction to computer games, and regulators are currently working on an overhaul to the approval process for new titles.<\/p>\n
Naspers currently makes up almost 21% of the value of the GEPF\u2019s listed equity holdings, the fund said in an emailed response to questions. \u201cThe GEPF does review its benchmarks from time to time,\u201d although \u201cnot all reviews lead to changes.\u201d The pension fund didn\u2019t answer a query about whether it has held talks with the PIC about the Naspers stake.<\/p>\n
Naspers declined to comment on discussions with specific investors. \u201cThe formation and listing of NewCo is in response to shareholder requests,\u201d spokeswoman Shamiela Letsoalo said in an emailed response to questions.<\/p>\n
The move will allow investors to move \u201csome of their weight off the JSE onto (Amsterdam\u2019s) AEX index while at the same time continuing to lock in continued high returns,\u201d she said. \u201cThis will likely result in shareholders having more balanced weightings and will help to reduce any overhang.\u201d<\/p>\n
While Naspers acknowledges that the company\u2019s assets and management will overlap with NewCo \u201cthere are also important differences,\u201d Letsoalo said. The parent group will separately own news business Media24, online marketplace Takealot and \u201ccontinue to invest in South Africa\u2019s fast-growing ecommerce and internet segment,\u201d she said.<\/p>\n
\u201cThese differences will cause many investors to view them separately within their portfolio.\u201d<\/p>\n
NewCo will hold various internet businesses around the world, including Russian social-media network Mail.ru Group Ltd. and Indian food-delivery service Swiggy as well as Tencent.<\/p>\n
The debate over the stake in Naspers has been going on for months. One element being discussed is whether the GEPF should change its holding from an arrangement known as a full SWIX, or shareholder-weighted index, to one called a capped SWIX, where a single stock can make up a maximum of 10% of the funds, three of the people said. Any sell down would be done in phases, one of the people said.<\/p>\n
Phased Selldown<\/strong><\/p>\n Last October, another of the PIC\u2019s clients, the Unemployment Insurance Fund, sold Naspers shares to switch from a full SWIX position to a capped one, the fund said in an emailed response to questions. Prior to this it had used derivatives to hedge the risk but found this too costly, it said.<\/p>\n What to do with the GEPF\u2019s Naspers stake is being considered by the fund\u2019s board of trustees, one of the people said. Pierre Snyman, a member of the board and chairman of the Public Servants Association, declined to comment.<\/p>\n Some senior members of the GEPF are opposing cutting the shareholding, said one of the people.<\/p>\n \u201cThe PIC does not publicly discuss its strategy on specific investee companies,\u201d Deon Botha, its head of Corporate Affairs, said in a response to queries.<\/p>\n
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