PrimeTime, RDC lock horns again on takeover bid
Mbongeni Mguni | Friday July 11, 2025 12:33
RDC is aiming at securing at least 40% equity in PrimeTime and recently opened a direct offer to shareholders, a move categorised as a 'hostile takeover' as the offer is being made directly to shareholders rather than via board approval.
The offer, which closes on August 22, follows the conclusion of an extended probe by the Botswana Stock Exchange after a tense period last year when PrimeTime accused RDC of, amongst others, weighing its stock down by introducing uncertainty over the takeover. A BSE committee cleared RDC of nearly all accusations and approved the floating of the offer to PrimeTime investors.
As shareholders weigh the offer, matters escalated again this week, as RDC responded to allegations made recently by the PrimeTime board that the proposed deal is “unfair and unreasonable,” significantly undervalues PrimeTime, will result in increased expenses and inefficiencies and is “highly dilutive” to PrimeTime shareholders.
PrimeTime directors also told its shareholders that RDC’s local assets are overvalued.
The PrimeTime board has told its shareholders to ignore the offer and directors say they have the written support of shareholders representing 38% of the share registry.
Hitting back at the PrimeTime board on Wednesday, RDC directors said the allegations made against the offer were “materially incorrect and potentially misleading”.
RDC directors said the offer was not dilutive and represented best value for PrimeTime shareholders.
“Contrary to the suggestion that PrimeTime offers a superior investment proposition, RDC’s track record demonstrates sustained operational and financial outperformance,” RDC directors said. “Revenue and operating profit have consistently exceeded those of PrimeTime (whilst) diversification across geographies enables RDC to deliver stable, resilient income streams. “Performance metrics such as revenue and operating profit are more indicative of portfolio strength than vacancy rates, which fluctuate with lease cycles and economic conditions.” “PrimeTime’s concentrated exposure to the Botswana market increases its risk profile in the current economic climate.”
RDC’s board insists that the offer to PrimeTime represents the best value for shareholders and highest future prospects.
Meanwhile, independent research firm, Golden Section Capital, has poured cold water on the proposed deal, supporting PrimeTime board’s recently released opinion that the RDC takeover bid is not in PrimeTime shareholders’ best interests.
In an analysis made available to BusinessWeek, the firm advised PrimeTime investors to exercise caution and patience, advising them not to “tender or trade on emotion or rumours” and to “read the formal independent advice”.
“The offer, as it is, raises several red flags, including undervaluation, potential self-interest conflicts and execution uncertainty, that cannot be ignored,” the firm said. “Unless these concerns are mitigated through revised terms of new information demonstrating greater upside, holding off on acceptance appears prudent. “For those with a long-term investment horizon, the prospects of PrimeTime improving on its own or via a better deal in the future most likely outweigh the claimed gain this offer states it will provide.”
Golden Section Capital added that ultimately, the decision to take part in the offer or not hinges on the investor’s confidence in PrimeTime’s standalone turnaround versus the combined entity’s prospects under RDC.
“At present, we identify more risks than rewards in the hostile offer,” the firm said.
Golden Section found and managing director, Garreth Elston, told BusinessWeek the firm’s analysis was independent and had not been contracted for or paid for by either PrimeTime or RDC.
Other analysts have pointed out RDC needs a major PrimeTime shareholder to agree to its proposals in order to comfortably secure the target shareholding it is seeking. All eyes are on the Botswana Public Officers Pension Fund, the largest PrimeTime investor, with 32.14% equity.
The second largest PrimeTime investor, Linwood Holdings, has reportedly signed an agreement not to participate in RDC’s takeover bid.