Discovery, via its subsidiary Vitality Group International Incorporated (VGI), has sold a huge chunk of its stake in Cambridge Mobile Telematics Incorporated (CMT) for $49.5 million (roughly R831 million).
Discovery invested $5 million in 2014 to acquire a 21.67% interest in CMT, which has been an associate investment and a strategic partner to Discovery Insure.
The Cambridge, Massachusetts-based company provides expertise in the telematics environment.
Since 2014, there have been several capital injections by other investing parties and corporate actions, which resulted in net dilution and disposal gains for Discovery of $75 million in aggregate.
These gains have been recognised outside of normalised profit from operations over time. This includes a partial sell-down in 2019, in which Discovery received $28.5 million in cash proceeds.
Before this disposal, Discovery’s remaining shareholding was 8.7%.
Near the end of 2025, TPG Global LLC made an offer to CMT shareholders in which Discovery was given an option for a partial sale of up to 50% of its remaining shareholding.
Discovery said that the terms of the offer were appealing, especially as it expects its strategic partnership to be unaffected by the reduction in the group’s shareholding.
The offer was subject to several regulatory approvals and other customary suspensive conditions, all of which have been obtained, and the offer has been finalised.
Following the offer becoming unconditional, VGI disposed of 49.1% of its total shareholding in CMT, and the company received gross cash proceeds of $49.5 million (about R831 million) for the disposal.
Discovery will still account for the investment as an associate, given its contractual strategic rights and ongoing involvement.
Regarding the impact on earnings, the disposal has crystallised the equity-accounted earnings attributable to this portion to date.
There was also an additional gain on the partial disposal of an interest in an associate of $7.9 million (c. R133 million), net of attributable costs and tax.
The gain on disposal will be excluded from normalised operating profit, headline earnings and normalised headline earnings for Discovery’s financial year ending 30 June 2026.
