Prosus N.V.Figures

Prosus is a Dutch technology holding whose three quarters of value sit in a line it does not control. Its gross assets stand at USD 168,775m at 31 March 2026, of which Tencent alone accounts for 75.6%, through a 22.66% minority stake in a Hong Kong-listed company it does not consolidate. Its entire allocation doctrine rests on a single arbitrage: sell a small fraction of Tencent each year, at its market price, to buy back Prosus shares, which trade well below the value of what the company owns. Over the year the group cut its Tencent position by 0.9% and booked an accounting gain of USD 4.7bn on it.

The buyback is therefore not one tool among others, it is the philosophy. Since 28 June 2022, 939,992,619 ordinary N shares have been repurchased for USD 32.8bn, that is 32% of the free float. And the loop has two floors, which makes it hard to read from a distance. At Prosus level, Tencent funds the buyback of Prosus shares. At Naspers level, the South African parent sells Prosus shares to fund the buyback of its own stock in Johannesburg: 365,249,825 Prosus shares sold, 323,404,606 Naspers shares repurchased, USD 12.1bn committed. Both floors draw on the same source. The company gives the combined total, around USD 46bn returned to shareholders since June 2022, and quantifies what the loop mechanically produces: an additional 16% in net asset value per share compared with what it would have been without buybacks.

The counterpart is rarely stated, and it should be named. A buyback funded by selling the main asset reduces absolute net assets in order to raise net assets per share. Both movements are visible in the same series. The number of shares falls from 2,602.678 million at 30 September 2023 to 2,117.581 million at 30 June 2026, that is 18.6% fewer in eleven quarters, recalculated. The Tencent stake falls from 23.49% at 31 March 2025 to 22.66% a year later, and the company itself names the move. At that pace the line financing the buyback would run out over decades rather than years: this is not a short-term risk. But the company also states its intention to keep Tencent for the foreseeable future, without ever saying how far down it will go. Both statements coexist, and this is the most useful question to put to it.

Prosus has made cutting its discount a publicly verifiable pay condition for its chief executive and finance director, worth 10% of their annual variable pay. That is rare and creditable: the house accepts being scored on a figure it does not fully control. The year's outcome is an admitted failure, the discount staying flat at around 42% and the corresponding component being paid at zero. Two caveats come with that figure: the company publishes the percentage without publishing its base, neither the share price used, nor the net asset value used, nor the measurement window, and the wording refers to a group discount, which the results booklet elsewhere defines as the combined Naspers and Prosus discount. Meanwhile a second, operating business is growing: seven named consolidated subsidiaries, iFood, OLX, Just Eat Takeaway.com, eMAG, iyzico, Despegar and PayU, plus La Centrale acquired for USD 1.3bn, organised in three regional ecosystems, Latin America, Europe and India. One flow is worth isolating to see where that business stands: excluding the USD 1.2bn dividend received from Tencent, group free cash flow moves from USD 18m to USD 275m. In other words the operating ecosystems have only just tipped into self-financing, and the group's cash is still Tencent's.