BTCL share price set for unveiling

Keikantse Lesemela | Tuesday October 7, 2014 11:17

BTCL shares discussions.Pic.Kagiso Onkatswitse

Government plans to offer 44 percent of its shareholding to citizens and citizen-owned companies via the Initial Public Offer (IPO), retaining 51 percent and committing five percent to citizen workers. While the share price will only be known when the prospectus supporting the IPO is published next month, recent trends on the local bourse suggest a price between P1.00 and P2.00.

A share price within that range would be keeping in line with trends in the most recent Botswana Stock Exchange (BSE) primary listings. Property group, Letlole la Rona listed in June 2011 at P1.45, while mega-supermarket chain, Choppies, debuted in January 2012 at P1.15. Property group, New Africa Properties had one of the highest IPO prices in recent years when it debuted in September 2011 at P2.00.

The last local listing, Shumba Coal, debuted in April 2013 at P1.00.

At yesterday’s IPO Awareness Pitso, however, all principals close to the transaction were tight-lipped on the price of the share offer, leaving some sections of the packed conference hall disgruntled. Collins Newman and Co senior partner, Rizwan Desai, said all drivers of the transaction were bound to non-disclosure by existing regulations. Collins Newman, Deloitte, Barclays and several other firms are among a large team of advisers for what will be the country’s first equity-sale privatisation of a parastatal.

“The price will be known when the prospectus comes out and this document will also indicate how the price was calculated.”

BTCL managing director, Paul Taylor said having passed through due diligence and evaluation, all stakeholders and advisers were currently working on the share price and the quantum of shares to be offered in the IPO.

This process is running alongside the continuing educational marketing initiatives that include Friday’s Awareness Pitso in Francistown and countrywide roadshows.

In a later interview, Taylor told Mmegi Business that the prospectus would be published next month, with a drive for the 7th, which is a date announced by the Corporation’s parent ministry.

“The publication of the prospectus will mark the official opening of the offer,” he said.

“The listing will take place between four to six weeks after the prospectus is published.”

Earlier, the MD told scores of Pitso attendees that the prospectus would be available at BTCL offices and branches of Barclays, which is understood to be the transaction’s banking advisor.

An allocation committee is being established for the IPO which will ensure “equity and fairness” in the sale of BTCL shares. It is understood that while retail investors will be prioritised over institutional ones in the IPO, factors such as a buyer’s individual wealth or demand will not influence eventual allocations.

The last local listing, Shumba Coal, debuted in April 2013 at P1.00.At yesterday’s IPO Awareness Pitso, however, all principals close to the transaction were tight-lipped on the price of the share offer, leaving some sections of the packed conference hall disgruntled. Collins Newman and Co senior partner, Rizwan Desai, said all drivers of the transaction were bound to non-disclosure by existing regulations. Collins Newman, Deloitte, Barclays and several other firms are among a large team of advisers for what will be the country’s first equity-sale privatisation of a parastatal.

“In terms of price, please note that we are bound by a very comprehensive legal process from the BSE,” he said. “If a price is indicated today and if it changes for any reason, there will be a problem and the BSE requires that the price has to be in black and white on a document from which no one will back down.“The price will be known when the prospectus comes out and this document will also indicate how the price was calculated.”BTCL managing director, Paul Taylor said having passed through due diligence and evaluation, all stakeholders and advisers were currently working on the share price and the quantum of shares to be offered in the IPO.This process is running alongside the continuing educational marketing initiatives that include Friday’s Awareness Pitso in Francistown and countrywide roadshows.

In a later interview, Taylor told Mmegi Business that the prospectus would be published next month, with a drive for the 7th, which is a date announced by the Corporation’s parent ministry.“The publication of the prospectus will mark the official opening of the offer,” he said.“The listing will take place between four to six weeks after the prospectus is published.”Earlier, the MD told scores of Pitso attendees that the prospectus would be available at BTCL offices and branches of Barclays, which is understood to be the transaction’s banking advisor.An allocation committee is being established for the IPO which will ensure “equity and fairness” in the sale of BTCL shares. It is understood that while retail investors will be prioritised over institutional ones in the IPO, factors such as a buyer’s individual wealth or demand will not influence eventual allocations.