South African Tycoon John Copelyn's Hci To Sell Hermanus Mall Stake For 36 Million In Latest Property Exit

Hosken Consolidated Investments, led by chief executive and co founder Johnny Copelyn, has agreed on Jan. 7 to sell its majority stake in a shopping centre in the coastal town of Hermanus for 600 million rand 36 million, part of a broader drive to pare back property holdings and strengthen cash flow. HCI said its unit HCI Whale Coast Village, in which the group holds an 80 interest, will sell a combined 65 undivided share in the rental enterprise known as Whale Coast Village Mall. Whale Coast Capital Investments will buy 40 and Whale Coast Village Mall will take the remaining 25, the company said in a voluntary stock exchange announcement. The purchase price is inclusive of value added tax at a zero rate, HCI said. The deal is subject to conditions, including approval by competition authorities. Proceeds will first be used to settle tax obligations and repay about 328 million rand of debt owed by HCI Whale Coast Village to its funders. HCI Whale Coast Village plans to distribute the balance to shareholders, including HCI, which said it indirectly holds 80 of the company. The implied value of the mall based on the majority stake works out at just over 920 million rand, close to 1 billion rand. Whale Coast Village Mall, in the Overstrand municipality, has been positioned as a regional retail node serving residents, tourists and weekend visitors from Cape Town. Copelyn has steered HCI for decades, building a portfolio that ranges from hotels and leisure to interactive gaming, media and broadcasting, transport and mining. In recent updates, the group has signalled it wants less capital tied up in real estate and more flexibility to fund growth and reduce debt. The Hermanus sale follows another property disposal announced in December. Through subsidiary Permasolve, HCI agreed to sell The Point Centre in Cape Town for 943 million rand to Future Indefinite Investments 180. HCI said at the time the proceeds would settle Permasolve borrowings and tax bills, with remaining funds used to reduce group debt and preference share funding obligations. HCI has argued that trimming property exposure can simplify the group and sharpen returns from its operating businesses. In its most recent interim results, for the half year ended September, revenue rose 8 to 7.1 billion rand and headline earnings per share climbed 74 to 922 cents. Earnings contributions highlighted the tilt of the group. Gaming delivered 388.4 million rand, hotels 134.1 million rand and properties 54.5 million rand for the six months, according to the company. HCI has interests in major South African leisure assets, including the Montecasino hotels, Gold Reef City Hotel and Silverstar Hotel. Investors will watch how quickly the latest property proceeds flow through to the balance sheet. The deal does not require a shareholder vote under stock exchange listing rules, and HCI said it disclosed the transaction on a voluntary basis. If approvals are secured, Copelyn will have taken another step in reshaping the group away from bricks and toward capital.