South Africa’s Novus Holdings sells KwaZulu-Natal property assets in $5.4 million disposal

Novus Holdings Limited, the South African printing and packaging group, has agreed to dispose of a property-backed letting enterprise for R91.7 million ($5.4 million) as part of a strategy to streamline its portfolio and exit non-core assets. 

The transaction, concluded through its wholly owned subsidiary Novus Print, marks a decisive step in refocusing the group’s capital allocation priorities.

Portfolio optimization drive
The sale, signed on March 17, 2026, involves the disposal of industrial properties located in Phoenix Industrial Park, KwaZulu-Natal, along with an existing long-term lease agreement tied to the assets. The buyer, Firm Favourite Investments 10, is an independent third-party entity ultimately owned by Map Clothing Manufacturers.

The properties are currently leased to Mthembu Paper Mill under a 10-year agreement running from December 2020, generating rental income of about R7.3 million ($429,539) annually. The lease includes annual escalations of 7%, providing stable income streams prior to the disposal.

Unlocking value from non-core assets
Novus said the transaction (KwaZulu-Natal industrial assets sale) aligns with its broader strategy to optimize its asset base following its partial exit from the tissue business in 2021, when it sold a 51% stake in Correll Tissue. While the group retains an associate interest in Mthembu Paper Mill, the underlying property assets have been classified as non-core to its long-term operations.

By disposing of the letting enterprise, Novus aims to unlock capital tied up in real estate and redeploy proceeds toward core business segments and growth initiatives. The full consideration will be settled upon transfer of the properties, expected by the end of June 2026, subject to standard conditions including due diligence and regulatory approvals.

Financial impact and outlook
Headquartered in Cape Town, Novus Holdings, founded in 1905, with core operations comprising an extensive network of specialised printing and manufacturing plants, is currently valued at a market capitalization exceeding $100 million.

The assets carried a book value of R58.7 million ($3.45 million) as of March 2025, implying a notable premium on disposal. The letting enterprise generated profit before tax of R7.3 million ($429,539) in the last financial year, highlighting its steady but non-strategic contribution to earnings.

The proceeds will be added to Novus’ existing cash reserves, strengthening liquidity and supporting future investments. As the company continues to reshape its portfolio, the disposal underscores a disciplined approach to capital management and a sharper focus on core operations in a competitive printing and packaging market.