Tencent investors Naspers and Prosus announce abrupt departure of CEO Bob van Dijk

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Bob van Dijk

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The immediate and mutually agreed departure of Naspers and Prosus CEO Bob van Dijk underscores a complicated few years for a firm seen riding on the coattails of its holdings in Chinese tech giant, Tencent.

In June, the Dutch-based e-commerce investor, Prosus, which is majority-owned by South African multi-national Naspers won shareholder and regulatory approval to unwind its complex ownership structure.

The South African Reserve Bank gave Naspers the greenlight to begin buying back more of its shares from Prosus.

“Getting rid” of the crossholding

Prior the current structure, Naspers owned a third in Chinese internet giant Tencent Holdings. Koos B. Bekker, the current Naspers chairman and founder, made this investment in 2001 when he spent $34 million to acquire a 46.5% share in the company. Tencent’s stock soared to a market cap of over $1 trillion during the Covid-19 Pandemic. This meant Naspers made up nearly a quarter of the Johannesburg Stock Exchange which was a problem for some fund managers.

Then in 2021, Naspers developed a crossholding using a share swap deal. Prosus bought a 45.4% share in Naspers and moved a piece of Naspers to Amsterdam’s Euronext. We listened to their concerns. “

Stepping up

On Monday, the business announced on a call with investors that the unwinding of the crossholding had officially been completed. The business now aims to maintain profitability going into first half of 2025 fiscal year. “[shareholders]Stepping Up

On a Monday, the business announced that the unwinding process of the crossholding was complete. The business is now looking to maintain profitability in the first half fiscal year 2025. Erwin Tu, Prosus group chief investment office, has been appointed interim CEO. Citi said that they see “a good possibility” that he will become permanent CEO. Citi analysts stated that they suspect the announcement was not a sudden one, but rather a decision the company made after the unwinding of the crossholding process. Bekker also said that the lengthy process of finding a new CEO would not only focus on internal candidates or applicants, but will also look at external leaders. Tu was a managing partner in the Goldman Sachs technology banking group. Bekker also said that the process of finding a new CEO was not one that focused only on internal applicants or candidates but that the lengthy process would also look at external leaders as well.

Tu said the business will continue to “invest in a disciplined way” and that the share repurchase will remain in place for as long as the discount on the net asset value of the companies remained elevated.

Shares of the Naspers slipped 3% Monday in South Africa on the back of the news of Van Dijk’s departure, despite an initial rise of 2% in early deals.

Van Dijk has agreed to remain as a consultant until September next year but has stepped down from the board of both businesses. The company stated that the group’s strategy goals are unchanged, and they will be able to meet their commitments. Van Dijk’s recent salary was criticized by shareholders who objected to its link to Tencent’s growth and performance. Naspers shareholders who have the power to vote voted 80 percent against its remuneration policies. Van Dijk earned 13.5 and 14.2 millions euros in 2021 and 2022, with his salary reduced to 5.5million euros for the past year.