A little-known marketing and advertising company called B&B Media is taking over Imbalie Beauty, a small cap listed on JSE-owned AltX which runs beauty franchises and skincare brands and also provides education to beauty therapists in the industry.
A statement posted on Sens on Thursday by Imbalie Beauty, which has a market value of about R27.7m, said that B&B Media had bought out 61.26% of the company at a price of 0.9c a share. That equates to an about R7.63m price tag for the 61.26% stake, which is held by the company’s big shareholders, including Imbalie CEO Esna Colyn, Holistics Remedies, SA Madiba Investments and Unihold Group.
The remaining minority shareholders will have the option to either accept B&B Media’s offer of 0.9c a share, which is a big discount to Imbalie’s last traded share price of 2c a share though it must be said the stock is illiquid given its small-cap status. Should minorities choose not to accept that offer they can remain invested in the listed shell company, which B&B Media plans to use to reverse list a number of its assets that are privately held.
Colyn told Business Day that Imbalie’s assets would be transferred out of the listed entity into a new privately held vehicle called iBloom, which would continue to operate its three main divisions of skincare products, beauty salon franchises and education programmes for beauty therapists. She says the reason for taking Imbalie’s assets private stems from the conditions of a R6m Covid-19 loan the company received in 2020, which required it to be unlisted.
In return for the loan Imbalie agreed to delist, a perhaps unsurprising option for the company after it was publicly censured by the JSE in 2019 for providing misleading information to investors. Colyn says Imbalie opted for the Covid-19 loan after its beauty salons were forced to endure 87 days of cumulative closures in 2020 due to SA’s lockdown restrictions.
“In 2020 we received a Covid-19 loan from Absa and the Reserve Bank and one of the conditions was that we had to delist,” said Colyn. “However, we will continue operating in an unlisted environment. We think this transaction with B&B Media is a very good opportunity for minority shareholders who want to stay invested in the new [small cap] play.”
Aboobaker Cassim, a financial manager at B&B Media, says the transaction will take effect on January 17 and will see the company reverse list some of its fashion and retail assets into the listed entity that will remain after Imbalie’s operations are transferred into iBloom. Though B&B Media is focused on billboard, digital and television advertising it also owns several fashion and retail assets.
“It was cheaper for us to reverse list into Imbalie than to go through a listing exercise independently,” said Cassim.
Imbalie had previously tried to sell its JSE listing in 2018 through a series of transactions that were meant to see Wepex Geotechnical and Makgarapa Products reverse list into the listed vehicle. However, negotiations between the companies were later called off.
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