Empowerment Foursome

It has been an interesting week for my 'empowerment foursome"

Mvelaphanda Group
As per my last post, I got my paws on some Mvelaphanda Group (MVG) shares. My initial bid was a cheeky R5.95 but when it became apparent that it wasn't dropping below R6 I was happy to pay the R6.30.

The motivating factors for buying this company were:

A) The special dividend coming up in the middle of the month
B) The quality assets they seem to have under them that are being discounted by the market. You seem to be getting a lot of future earnings for next to nothing.

One of the things I like about the MVG story is that the general perception in the market, is that they don't think of themselves as an 'empowerment company'. They view themselves as an industrial company that happens to have a large black representation.

Personal opinion - over the next 10 years, this is going to become a serious player in the South African industrial segment off its own bat.

Sekunjalo
Intriguing things happening at Sekunjalo this week.

The company announced that they had gone into negotiations and the share price leapt up from 61c - 68c.

A nice bit of volume as well and no announcement that there were some director dealings so maybe it is not Surve buying shares.

According to website www.sharetips.co.za, there is a good chance that SKJ is going to be delisted in a management buyout by Surve.

I'm less convinced and think its an acquisition but nothing seems immediately obvious.

But I admit that I will be very irritated if this is a management buyout and delisting.

Brimstone
Investors seem to be recognising that there might be some disconnect between Brimstone's share price and the underlying operations.

The company is on a VERY undemanding price to earnings ratio.

The shareprice has jumped nearly a Rand (20% this week), admittedly on relatively thin volume. Even after this jump the share is still trading on a PE ratio of under 3 times earnings... must be money for jam.

Vunani
The company went under cautionary on Thursday afternoon. 24 hours later, Peregrine (of which Vunani holds 15%) also went under cautionary as it was announced that CEO Sean Melnick and management partners are planning to delist the business in a management buyout.

As a shareholder in Peregrine, I can't say I'm happy.

But Vunani has been doing some nice things since listing and the share price doesn't really reflect it.

The share is illiquid at the moment and there are some minor operational issues which need to be smoothed out.

But barring a huge disaster, I don't think this is a bad story. If they can retain their Peregrine exposure then they should do nicely over the next few years and re-rate appropriately.