'GetBucks Zim IPO builds confidence'

HARARE - Micro-finance institution GetBucks Zimbabwe (GetBucks) says its intention to list on the Zimbabwe Stock Exchange through an Initial Public Offer (IPO) is aimed at restoring and building confidence on the local bourse.
 
The company’s nonexecutive director, George Manyere, told stakeholders attending a GetBucks breakfast meeting in the capital yesterday that there was need for the private sector to initiate more IPOs on the beleaguered local stock exchange.

“This is the perfect time for us to list because we think the economy is doing very well for those who see opportunities,” he said adding that GetBucks’ decision will act as a catalyst to encourage other companies to list. 

This comes as the Zimbabwe Stock Exchange, which last had an IPO in 2007 when Philip Chiyangwa’s Zeco Holdings listed, has been struggling to register any significant gains in the past two years due to declining economic conditions.

Statistics from the market watchers show that the local bourse — with 60 counters — has lost over $2,5 billion in market capitalisation since President Robert Mugabe won the 2013 elections under controversial circumstances.

Manyere said GetBucks, a subsidiary of Brainworks Capital Management Limited, was working on building a strong business that will challenge traditional banks, which have neglected the country’s unbanked population.

“This IPO is a sign of confidence in a traditional microfinance business that is being delivered on the leverage of technology,” he said.

An IPO is the first sale of stock by a private company to the public. IPOs are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately-owned companies looking to become publicly traded.

GetBucks, which was recently awarded a deposit-taking licence from the central bank,  currently has a $11 million loan book and is offering unsecured loans for which repayments are deducted at source. The company sees its loan book growing after the capital raising initiative.

The company intends to raise a total amount of $3,2 million by way of an IPO through the subscription of 93 567 251 ordinary shares in GetBucks at a subscription price of $0,0342 per share.

On conclusion of the IPO, it is envisaged that the entire issued share capital of GetBucks of 1 093 567 251 ordinary shares will be listed on the ZSE.

GetBucks commenced operations in 2012 as a credit only microfinance institution, and the business has over that short period of time, grown into one of the leading microfinance lenders in Zimbabwe.

“The strategic objective of GetBucks is to retain and grow its market share in Zimbabwe through a sustainable business model that offers competitive interest rates while managing its cost of funds,” Manyere said.

Comments (2)

you are valuing your company at 34 millilion dollars on what basis according to your shares issued ? yet you only have a debt book of 11 million . over and above that , what percentage is been offered on IPO ? very insignificant . something wrong here . i dont buy why you are even listing and to what real purpose ?

private equqitet - 1 January 2016

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