Billionaire businessman Johann Rupert has remained hopeful that interest rates and consumer inflation have started to decline as liquidity from the private and banking sectors improve, although financing costs remain elevated.
Rupert’s Reinet Investments, which has investments in British American Tobacco (BAT), on Tuesday said it invested capital worth €128 million (R2.55 billion) during the year ended March 31, with the lion’s share in funds managed by the investment firms Trilantic Capital Partners, TruArc Partners and Coatue.
This left Reinet with cash resources of some €357m.
The company also has access to additional funds via additional borrowing facilities, which will be pivotal in meeting its investment obligations and other opportunities.
“During the past year we have seen interest rates and inflation starting to decline in some major economies with available liquidity from the private and banking sectors for capital investments showing early signs of improvement. However, the costs thereof remain high,” Rupert said.
In the full-year period under review, Reinet is proposing to lift its dividend payment by 16.67% to €0.35 per share, payable in September.
Shares in the company had firmed up by 4.8% to R491.66 on the JSE by about 5pm on Tuesday.
Reinet disclosed that its net asset value, which closed the period at €6.2bn, had risen by some €464m or 8.1% compared to the year ended March 31, 2023.
It said the increase in its net asset value reflected the increase in the value of Pension Insurance Corporation (PIC), together with the receipt of significant dividends from both PIC and BAT.
However, these gains had been offset by a decrease in the share price of BAT, while the strengthening of sterling pound against the euro in the year also contributed to the positive results.
The company has made investment commitments totalling €61m in respect of new and existing investments during the period under review, with about €128m already funded.
Dividends from BAT during the year amounted to €130m, with the inaugural dividend of €57m emanating from PIC.
Reinet's investment in BAT decreased in value in the year due to its share price decreasing from £28.41 at March 31, 2023, to £24.06 as at March 31, 2024.
At the BAT annual general meeting in April 2024, shareholders approved a dividend increase of 2% to £2.36 per share.
The cigarette company continued to follow its strategic path and commitment to building a smokeless world by migrating its cigarette consumers actively, sustainably and responsibly to reduced risk, smokeless alternatives.
Rupert said the board and leadership of BAT is focused on securing long-term, sustainable value creation.
BAT had set a target of 50% of revenue from “non-combustibles” by 2035, while TruArc continued to pursue new opportunities.
Early this year, TruArc launched the TruArc Structured Opportunities Fund, which seeks to deliver flexible capital to middle market entities in North America.
Reinet had already committed some €17m in investment into the TruArc Structured Opportunities Fund as part of the first close.
It expects to commit further amounts as it has outstanding commitments to TruArc managed funds amounting to €122m, with some €330m already invested to date.
BUSINESS REPORT