Fresh from the investment of $100 million in former Alec Oxenford’s startup, Letgo, Naspers is seeking to increase investments in the US. Hitherto, the South African media giant has been investing in emerging economies, consciously staying clear for developed countries. Naspers currently has operations in more than 130 countries and its biggest investment is a 34% stake in Chinese internet business Tencent Holdings, valued at about $64bn.
According to Naspers CEO, Chief Executive Officer Bob van Dijk, the move is to limit the impact of a US interest rate rise and identify new internet growth prospects. He stated this in a recent interview and continued by saying, “Naspers could base a number of investment professionals in the Bay Area to identify the right deals”.
“We will probably have more focus on the Bay Area than we’ve had previously,” Van Dijk said. “If we see the right opportunities we could see ourselves put a good amount of capital there.”
Naspers is braced for the US Federal Reserve to announce an interest rate rise, which would probably lead to the strengthening of the dollar and subsequent pressure on currencies in emerging markets where Naspers operates, Van Dijk said. The company has currency-hedging in place to help limit the blow, he said.
“There might be some pressure on the revenues in some markets if we translate it back into dollars,” Van Dijk said. The company is “relatively well” hedged against such an event, and “generally very well diversified in different currencies around the world,” he said.
Naspers said on Friday that first-half sales had been hurt by weakening currencies. Revenue gained 5% to $5.9bn in the six months through September, yet advanced 20% when the effects of foreign exchange and acquisitions were excluded. The shares have gained 42% this year, valuing the company at R906bn ($63bn)
