SA: Tiso Blackstar to dispose Gallo Music today

This is according to the terms of the sale, which indicate the anticipated disposal date of 10 March. This means ownership, including all risk and benefit attaching to the sale equity, will transfer to Lebashe, against receipt of the full purchase consideration.

On Friday, the former publisher of the Sunday Times and Business Day announced that it had sold its entire stake of Gallo Music to Lebashe for R75m ($4.7m).

The sale also included the acquisition of film production company Indigenous Film Distribution (IFD) for R10m.

The value of the net assets being disposed of is R37.364m, and the audited profits after tax came to R2.631m. This is according to financial statements on 30 June 2019.

Gallo is the largest record label in the country. Its business involves the acquisition of music rights as well as recording, manufacturing, distributing digitally and physically, and representing artists. It sells pre-recorded music and video in South Africa and abroad under the names of Gallo Record Company and Gallo Music Publishers. The company is known for working with South African artists like Ladysmith Black Mambazo, Stimela and Don Laka, among many others.

The business of IFD involves the acquisition, marketing and distribution of motion pictures and other film media produced in South Africa and distributed globally.

The deal is a follow-up from the sale of Tiso Blackstar’s media assets, which included print, broadcasting and content businesses in South Africa, Ghana and Kenya, to Lebashe for R1.05bn in 2019. It was decided that Gallo Music was part of the media structure.

Tiso Blackstar says the proceeds from the sale will be utilised to reduce the group’s debt to appropriate levels.

The record company will operate under the Lebashe Investment Group-owned Arena Holdings, which houses a number of publications including The Sowetan, Daily Dispatch, The Herald, Business Day TV and Financial Mail.