- Existing shareholders of the company are selling 121 620 240 of their shares to the public
- BSE has granted conditional approval to the listing of 419 893 554 shares in the company
- The listing is expected to give the general public an opportunity to acquire a stake in the company
CA Sales Holdings Limited, the South African marketing and distribution entity operating in the Fast-Moving Consumer Goods (FMCG) industry, is in the process of listing on the Botswana Stock Exchange (BSE), a development which is expected to give Batswana and other local investors an opportunity to own part of the entity.
CA Sales Holdings operation include purchasing of goods from manufacturers, providing warehousing and distributing goods for major retailers and wholesalers operating in Botswana, Swaziland, Namibia, South Africa, Lesotho, Zimbabwe, Zambia and Mozambique. The company also offers merchandising, marketing and promotion of consumer goods from manufactures locally and internationally.
The company announced this week that existing shareholders of the company are selling 121 620 240 of their shares to the public and that the entity is also offering 14 492 754 shares for subscription, a process which is expected to be followed by listing of a total of 419 893 554 shares on the 9th of November 2017. “The BSE has granted conditional approval to the listing of 419 893 554 shares in the company,” states CA Sales Holdings adding that listing is expected to give the general public an opportunity to acquire a stake in the company and benefit from the company’s projected expansion in the future.
In the prospectus which is intended to provide the public with information regarding the company, CA Sales management indicated that investments have been made in the businesses throughout Southern Africa to increase the company’s footprint and the group’s focus is to eventually grow its current business model, in sub-Sahara Africa. CA Sales management stated that there are a number of acquisitions that they are in the process of completing and noted that the businesses to be acquired have been in existence for some time with good management and they are strategically well positioned to expand CA Sales Group. “The acquisition opportunities are located in Zambia, Tanzania, Mozambique and Botswana,” state the company.
The executive Director of PSG Africa Holdings, the South African company which owns CA Sales has told potential investors and members of the public that the consumer market in Africa is expected to expand, create increased demand for consumer goods and ultimately benefit CA Sales. “With a population of estimated at 1.1 billion people and relatively high population growth rates, the African population is estimated to surpass the 2 billion marks in 15 years and is estimated to surpass China and India in the next 40-50 years. This growing population underpins a growing consumer market and in the future Africa will be the host to one of the largest consumer markets in the world. A key trend to note is the increase in female buying power, as women start to earn their own money, further adding to the growing consumer market,” said PSG Holdings Executive Director Johan Holtzhausen. He added that urbanization rates in Africa are also increasing especially in Sub-Saharan Africa with the UN urbanization estimating that the rates have increased from 11.2 percent in 1950 to 36.4 percent in 2010 and projected to reach 45.9 percent and 56.7 percent by 2030 and 2050, respectively. “This urbanization trend bodes well for the retail and FMCG industry in Africa,” he said.
The company’s financials show that the company’s profits have been increasing for the past four years and the profits increased from P53 992 million in 2012 to P136 423 million in 2016. “It is the Directors’ opinion that CA Sales is well positioned in the current market. For the year ended to 31 December 2016 the Group performed in line with expectations and it is the Directors’ opinion that the company has good future prospects,” he said.
CA Sales stated that while listing is expected to benefit local investors and the general public, it is also anticipated to assist the company to raise working capital. “CA Sales’ rationale for the listing is to allow Listing of the initial 419 893 554 shares on the 9th of November 2017 is expected to generate around P50 million,” he said.
The company stated that following the listing it intends to pay a full year dividend equal to 20% of the headline earnings for each year and the next dividend to be declared is estimated to be around R24 197 000, which is estimated to equate to R0.058 per share.