Letshego seeks to raise P285m in Namibian listing
Isaac Pinielo | Wednesday September 6, 2017 15:10
The financial services group announced last week during the presentation of its financials for the half-year period ended June 30, 2017 that it recently obtained approval from the Namibian bourse to list Letshego Holdings Namibia Limited (Letshego Namibia) on the NSX.
Group managing director, Chris Low said 20% of the company’s shares are being offered for sale as part of the licensing requirements of the Bank of Namibia to increase the level of Namibian ownership of Letshego Namibia.
“Should the listing be successful, this will raise approximately N$370 million for the portion of the shares, which is 17% that Letshego Holdings Limited is selling,” he said.
According to Low, the public offer opened on August 25, 2017 and will close on September 22, 2017 with an intended listing date of September 28, 2017. Letshego Namibia is a registered bank and micro finance group whose business activities are similar to the overall Letshego Group.
The net asset value of Letshego Namibia was N$1.6 billion (P1.25bn) at June 30, 2017 and the targeted market capitalisation on listing is N$2.350 billion (P1.83bn).
As at June 30, 2017, the total assets of Letshego Namibia represented 24% of the group’s total assets and it contributed 40% of the group’s pre-tax profit and 44% of the profit after tax.
“The impact of the listing to the group results will be to increase the profit attributable to non-controlling interests,” said Low.
He noted that upon successful listing of Letshego Namibia, the board of directors will consider whether the listing proceeds will be distributed to shareholders or whether the cash should be deployed in the business. Letshego Namibia opened its doors in 2002 as Edu Loan Namibia, providing consumer and micro-lending services. In August 2008, Letshego Group acquired 100% of the company, soon after which the company re-branded to Letshego Financial Services Namibia.
Letshego Group is the largest indigenous Botswana Stock Exchange (BSE)-quoted company with a current market capitalisation in excess of P5 billion that places it in the top 40 sub-Saharan Africa companies, excluding South Africa.
Meanwhile, during the period to June 30, 2017 the group did not exercise the mandate from shareholders to repurchase any of its shares on the BSE. However, the managing director indicated that subject to the necessary funding being available, the company will re-enter the market to buy back shares, adding that it is targeting to repurchase up to five percent of the shares in issue.
“This will be dependent on the liquidity in the market as well as funding lines being available as already mentioned,” he said.
He added that the share buy-back programme is intended to generate returns for shareholders over and above the existing dividend policy.
Since Letshego listed on the BSE in 2002, it has raised P646 million from shareholders. In the same period, it has returned P1.9 billion to shareholders by way of dividends and share buy-backs, of which P1.2 billion has been returned since 2014.