Johnnic Holdings was one of South Africa’s first Black Economic Empowerment (BEE) companies but yesterday its rival in a contest for southern Africa’s largest hotel and entertainment group, Tsogo Investment Holdings (TIH), became the effective controlling shareholder of Johnnic. At a shareholder meeting three directors of Hosken Consolidated Investments (HCI) were elected to the board at Johnnic and ended Johnnic’s bid to buy Nafhold, a deal which would have given it a 34.5% stake in TIH.

TIH controls the gaming group Tsogo Sun, the lucrative prize for the victors of the battle. The contest between Johnnic and HCI began around two and a half years ago when both companies started to buy up shares in TIH with an end view of controlling Tsogo Sun’s five casino operations. After yesterday’s meeting the disappointed Johnnic CEO, Christine Ramon, admitted that HCI will now determine the future of Johnnic.

HCI presently holds a 49% interest in Johnnic and an offer to buy shares for R10.70 closed earlier this month. This deal was raised to R12.50, an amount still thought to be too low by some analysts. Had its bid to buy Nafhold been successful, Johnnic shares would have been valued at R15. Tsogo Sun holds gaming licences in four South African provinces, including its flagship development Montecasino in the Johannesburg area of Gauteng. (E-12.13.05)

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