A South African media firm that holds majority shareholding in Kenya’s Radio Africa Group has sold its media entities in an effort to relieve itself of debt.
The sale by Tiso Blackstar Group, which also owns media in Ghana, Nigeria but largely in South Africa, is for an estimated Ksh7.6 billion to financial services firm Lebashe Investment Group. The specific transaction details concerning the sale of its stake in Radio Africa are yet to be revealed.
With a 49% shareholding in Radio Africa Group, Tiso Blackstar Group leads in owning stock in the media firm ahead of individuals such as former Nairobi Governor Dr. Evans Kidero, Richard Ayah, Sudhir Vidyarthi, Kiprono Kittony and co-founders Patrick Quarcoo and William Pike among others.
The move could see sweeping changes at Radio Africa Group, which owns among others The Star newspaper, Classic 105 FM and Bamba TV.
In a statement, Tiso Blackstar said, “The transaction will require an internal restructuring of the group of companies of which Tiso Blackstar is the ultimate holding company , in order to constitute Tiso Blackstar Group’s existing interests in its broadcasting, content and media businesses in South Africa, Ghana, Nigeria and Kenya in separate legal entities which are capable of being disposed of to Lebashe.”
The largest English language publishing group in South Africa with papers such as the Business Day, the Sowetan, Financial Mail and The Sunday Times, the media firm has been facing tough financial times in a challenging disrupted media landscape. It was also set to close down the Sunday World but eventually found a buyer.
According to SABC, employees of Tiso Blackstar organised a strike in May amid salaries and bonuses woes. The firm which is listed on the Johannesburg Stock Exchange (JSE) was said to have seen its share price drop 80% in eight years.
The firm however said that during that period, it had worked on revolutionary changes amid the disruptions to how audiences now consume news.
“We have worked hard to ensure we modernize the media business from its legacy structures into an agile and forward looking company with a sustainable future. This is a perfect opportunity for a new owner to take it to greater heights,” said Tiso Blackstar Group chief executive Andrew Bonamour.
Its woes have also seemingly followed beyond South Africa, with Radio Africa Group also experiencing headwinds.
This however has not put off the new owners who said they were delighted by the deal.
Lebashe chair Tshepo Mahloele said, “Whilst the media industry in general is undergoing disruption, we believe that the assets we are acquiring are generating sustainable revenues to withstand the change in the medium term.”
The transaction, according to reports in South African media, is set to be financially effective by November and will be carried out in two operations, firstly for the South Africa businesses before concluding for the rest of Africa.