Naspers’s insurance plan – Prosus
For the last few weeks the Prosus team has been working hard to persuade anyone with the time to listen that there was a compelling reason for it to be hived out of Naspers and listed separately on the Amsterdam Stock Exchange.
It’s likely that awarding a really generous remuneration package to the team members and their expensive hangers-on was only part of that reason.
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The main reason was to reduce the hefty discount between Naspers/Prosus and Tencent; this, so the story goes, would be achieved by Prosus building up its own attractive portfolio of businesses.
A year is obviously too short a period to determine whether or not the strategy will be successful, but the signs aren’t encouraging. Prosus has failed to secure two eye-poppingly expensive acquisitions (even more expensive now), and the discount has grown.
Read: Prosus growing steadily, says management (Jun 30)
The grim reality for one-year-old Proses is that, on the basis of all we know, there is little to no chance its leadership team – no matter how much it’s paid – will weld together a collection of internet-based investments that could match what is being welded together by Tencent. Even if a lot of the estimated 700-plus companies Tencent has invested in fail, there is still considerable scope for continued great success. And it would be a level of success several times more impressive than the most successful scenario Prosus could hope for.
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