FSG minorities snub buyout offer

Exiting: FSG will soon delist from BSE
Exiting: FSG will soon delist from BSE

Only 308 FSG shareholders representing 3.3 percent of the company’s stock have accepted a P2.80 per share buyout offer from the majority owners of the company.

The offer had been made to a total of 1,520 shareholders holding 24.6 percent of the company’s shares, meaning about 87 percent of minority shareholders declined to be bought out of FSG.

The offer closed on the 4th of December.

Majority shareholders in FSG Limited, which include, Botswana Life Insurance Limited (BLlL), Flip Coin, Kate Maphage, Petronella Matumo and Tebelelo Seretse intend to buy the minorities out of the firm before delisting the company from the local bourse.

 “The offer was accepted by 308 shareholders holding 3,995,854 shares representing 3.3% of the issued shares of the company and representing 13.4% of those to whom the offer was made.

“As a result of the offer the offeror now holds 78.7% of issued shares,” said FSG in a statement.

Before the transaction, the largest shareholders in FSG included Flip Coin, which owned 34.5 percent while BLlL held 33.9 percent.

The new shares bought under the offer are likely to take BLIL or Flip Coin above the 35 percent shareholding, after which they are obliged by BSE rules to make a mandatory offer to minority shareholders.

FSG will become the second company to delist from the bourse in as many years following ABC holdings acquisition by Atlas Mara before subsequently exiting the BSE in 2014.

Founded by managing director, Milivojoe Nikolic and his wife Lynette in 2003, FSG listed on the local stock exchange in 2008.

According to FSG, the offerors had deposited P83.4 million with Stanbic bank, which was to be used to pay the minority shareholders who would have accepted the offer.

FSG recorded a 13 percent rise in profit after tax to P13.2 million in a subdued first six months of 2015 that was characterised by low demand and stagnant personal incomes.

In the period, revenue rose by 18 percent to P84 million, with Botswana operations showing resilience in a lukewarm economy.

The company, which also has operations in Zambia and South Africa, has a 65 percent market share in Botswana.

For the period, the directors declared an interim gross dividend of seven thebe per share, subject to the deduction of withholding tax at 7.5 percent.

Two years ago, Botswana Life’s parent company, failed in an attempt to take a majority shareholding in the funeral services company. At that time, BIHL was looking to better returns from investments in associate firms to bolster earnings after a challenging 2012 in which its flagship subsidiary Botswana Life was hard hit.

FSG is a funerals service provider engaged in the manufacturing of coffins and caskets, and  provision of funeral services.

The company, which owns a private cemetery in Gaborone, also acts as an independent agent in the marketing of funeral insurance policies in Botswana, Zambia and South Africa, which are underwritten by insurance companies.

Editor's Comment
What about employees in private sector?

How can this be achieved when there already is little care about the working conditions of those within the private sector employ?For a long time, private sector employees have been neglected by their employers, not because they cannot do better to care for them, but because they take advantage of government's laxity when it comes to protecting and advocating for public sector employees, giving the cue to employers within the private sector...

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