The acquisition by the JSE of Link Market Services South Africa (Link), the second-largest share registry business in SA, has been approved by the Competition Tribunal. The deal will be for a cash amount of R224.5 million, which translates into a 74.85% shareholding for the JSE. The BEE arm of Link will retain the balance of 25.15%.

‘This demonstrates that even in tough economic times there are opportunities where the JSE can make a difference to its clients by thinking creatively and working hard to deliver that difference,’ says Ursula du Plooy, Head of Issuer Relationships Management and Company Services at the JSE.

With six of the Top 40 JSE-listed companies as clients, Link will be operated as an independently run company. Link CEO Iqbal Haniff will remain as chief executive. ‘We are comfortable that the current staff have the skills and expertise to continue running the business as efficiently as it has to date,’ says Du Plooy.

She adds that the acquisition is opportune in that it responds to the need of the JSE’s listed companies for a holistic offering that consolidates their shareholder services, ‘especially primary listed companies, although Link is able to service unlisted enterprises that require assistance with their share register services’.

In addition, with the acquisition, the JSE intends to introduce products and services that will elevate communications and enable listed companies to better understand their shareholder base. These services include shareholder register maintenance, corporate actions, shareholder analytics, managing BEE share schemes, electronic communication and voting, and training and education of shareholders.

‘For the JSE, it means we will be able to diversify our revenue and extend the services we already offer through our Company Services team,’ says Du Plooy. These services comprise training, investor-relations support and listed company annual and interim results, presentation hosting and meeting support.

To complement the transaction, the JSE will be rolling out its ShareHub product – a platform that is a centralised hub that manages all communications posted to shareholders, and thereby facilitates a full audit trail from which reports can be extracted at any time on shareholder activities.

Reports are tailored to individual company needs, and can be used for targeted campaigns for shareholder participation. Examples include AGM-related announcements and relevant documentation; shareholder statements; general shareholder communication; and issuer announcements.

‘In some ways it mimics a mailing system without the usual relative frustrations, and a further boost comes from cost reductions [as well as] an increase in shareholder reach and education, and it is a seamless experience,’ says Du Plooy.

ShareHub (through the JSE’s Company Services) and Link are innovative responses to market needs, aimed at strengthening the JSE’s relationships with its listed clients (and potential new clients) in building stronger, more inclusive collaborative and solutions-driven services.

‘Link is such a great fit for us at the JSE, and we look forward to closing the transaction by the end of the year,’ she says. ‘It is really exciting to be part of a process that will not only change the transfer secretary offering in the market, but will also help us to offer issuers products and services that will remedy pain points and add value to their businesses.’

By Kerry Dimmer
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