Archive for the 'Botswana' Category
March 10th, 2010 by Tom Minney
The Government of Botswana has ended its P5 billion (US$722 million) bond issuance programme with an oversubscribed auction by the Bank of Botswana (www.bankofbotswana.bw) last Friday, 5 March, according to a report in Mmegi newspaper (www.mmegi.bw). The fundraising programme started in 2008 and raises funds for Government investment in large development projects under the National Develolpment Plan (NDP 10).
The central bank auctions Government bonds and treasury bills every six months, in March and September, and the auctions are open to members of the public.
The auction was the first time to launch a new, longer-dated 15-year-bond, providing the much needed benchmark for long-term borrowings. This was reportedly under allotted, with only P195 million of the P700 million on offer being allotted, despite total bids received being P 824 million. This may indicate that the market was demanding a heavier yield than Government was willing to pay.
According to the news report, there was overall oversubscription. The 6-month treasury bill fully allotted at P800 million and oversubscribed by P400 million. The 2-year bond was fully allotted at P200 million against P301 million of total bids received, the 51/2 years was slightly under-allotted, with P192 million of the intended BWP200 million being allotted.
The paper quotes Olebile Makhupe, Head of Global Markets at Standard Chartered Bank: “We have recently observed a shift in the Botswana yield curve with long-term yields picking up, reflecting expectation of higher rates in the future. In addition, long-dated asset yields have in the past reflected excessive demand rather than appropriate pricing for risk or where investors expect rates to be in the future”, she said.
Makhupe added that this trend seems to be changing, as availability of long dated assets has improved in the past few years.
“However, more work can still be done to create a platform for investors to liquidate their bond holdings when they need cash, rather than having to wait for the investment to mature, allowing for what is called secondary market trading,” she said.
According to today’s market report of the Botswana Stock Exchange (www.bse.co.bw), 10 Government bonds and 22 corporate bonds are listed, but trading does not seem very active.
March 7th, 2010 by Tom Minney
Conservation tourism pioneer Wilderness Safaris (www.wilderness-group.com) is aiming to get a primary listing on the Botswana Stock Exchange (www.bse.co.bw) and a simultaneous secondary listing on the Johannesburg Stock Exchange’s Africa Board (http://www.jse.co.za/Markets/Africa-Board) on 8 April. The share offer in Botswana and South Africa closes on 26 March. If successful, it will be the Africa Board’s second listing.
The company opened its offer on 26 February. According to Botswana’s Sunday Standard newspaper, the public offer is for 3 million ordinary shares at P4 ($0.5765 in today’s rate on www.xe.com) in Botswana and R4.56 ($0.6167) in South Africa and is fully underwritten. It closes on 26 March. Before the public offer, the company placed 56.3 million ordinary shares by way of a private placement, also at a price of P4 per share, says the newspaper.
According to an announcement on the company website it is “a strategically significant step in its evolution, designed to enable it to take full advantage of growth opportunities, to give the public an opportunity to participate in its future success, to develop a broader shareholder base and to simplify corporate structure.” Wilderness aims to use its tourism model to the fullest in contributing to conservation in Africa.
Growth in this manner is designed to allow the company to fulfil its objective of using its tourism model to the fullest extent possible in contributing to conservation in Africa.
Andy Payne, the CEO of Wilderness Holdings, says: “We believe that our unique positioning, iconic international brand and management’s long track record of financial and operational delivery present investors with an attractive growth and performance platform.”
Wilderness Safaris’ core philosophy is one of building sustainable conservation economies through responsible tourism, which shares the benefits of tourism with local communities and ensures that pristine wilderness areas are protected profitably.
The 26-year-old business is invested in 7 southern African countries and operates specialist travel businesses in 6 countries and 49 aircraft. It employs more than 2,700 people, most of whom come from remote rural communities.
The Chief Executive Officer, Andy Payne was reported in Sunday Standard as saying the company’s strategic objective was to double the number of owned Wilderness bed-nights by 2015, as well as to double the area under its influence by expanding into regions that complement its biodiversity and experience. It owns 53 destinations comprising of 930 beds and further manages 17 destinations with 280 beds.
The website says that Wilderness is “run by a group of likeminded wildlife enthusiasts who came together to build a successful safari business, delivering a unique experience for guests, fair returns for shareholders and stakeholders, while ensuring that southern Africa’s pristine wilderness areas remain sustainably protected.”
Thanks also to www.southafrica.info.
March 5th, 2010 by Tom Minney
Imara Holdings Ltd (www.imaraholdings.com), an investment banking and asset management group with operations in 10 countries mostly in southern Africa, aims to expand in Zimbabwe, according to Zimbabwe’s Herald newspaper. It is currently listed on the Venture Capital Market board of the Botswana Stock Exchange (www.bse.co.bw) and the Herald reports that it wants to buy the rest of the shares in Zimbabwe’s Imara Capital Zimbabwe (Pvt.) Ltd (www.imaracapital.com), which it owns 32%, and also to dual list on the Zimbabwe Stock Exchange (www.zse.co.zw).
The report says that Imara Holdings has proposed a share deal in which local shareholders and the management will get a shareholding in the parent in return for their shares in the local company. The dual-listing on the bigger exchange could make the shares more liquid and the dollar-based ZSE is attractive to international investors. Imara management reportedly refused to comment, possibly while the transaction is under approval by authorities.
Imara Holdings website does not mention the transaction, although it has been publishing cautionary announcements since 31 July 2009. It describes the group as “medium sized”. It has offices in Botswana, Malawi, South Africa and the UK, and associate offices in Malawi and Zimbabwe as well as working relationships with Stockbrokers Zambia, Namibia Equity Brokers and Mac Capital in Dubai.
According to the Holdings website: “We are independent and privately owned, enabling objective decision-making in the service of our clients. We are active participants in the region’s financial markets and maintain one of the largest research coverage of regional equities. Funds under management exceed US$ 135m and funds under administration exceed US$750m.”
Imara group services fall into three primary operating areas:
• Corporate Finance & Advisory Services
• Institutional and Private Client Asset Management
• Securities Trading
Imara Capital is one of the associates listed in Zimbabwe, others being listed on the website as Imara Edwards Securities (Pvt) Ltd, Imara Asset Management Zimbabwe (Pvt) Ltd and Imara Corporate Finance Zimbabwe (Pvt) Ltd. The Herald report says these are wholly owned by Imara Capital.
On 8 January Imara signed a licence agreement to become the 7th member of Global Alliance Partners (www.globalalliancepartners.com), of which Mac Capital Dubai is already a member. Bernard Pouliot, chairman of GAP and of the Quam Group based in Hong Kong, said Imara joins the alliance at a very opportune time when Chinese interest in Africa is growing: “Imara is good for the alliance and for China. Alongside other members of GAP, we are committed to hit the ground running when an umbrella investment scheme by African countries is developed and eventually implemented.”
The other GAP members are Quam Financial Services Group for Hong Kong and China, Capital Partners Securities for Japan, KT ZMICO for Thailand, Thanh Cong Securities Company for Vietnam, and Westminster of Hudson Securities in USA.
In December, Imara Holdings announced it had recently acquired a majority equity stake in the Botswana stockbroking company Capital Securities (Pty) Ltd., one of 4 licensed stockbrokers on the Botswana Stock Exchange, established in March 1999.
“Shareholders are advised that negotiations relating to a further regional acquisition, which was announced in a Cautionary Announcement published on 31 July 2009 and in subsequent renewal announcements, are still ongoing. Shareholders are therefore urged to continue to exercise caution in their dealings in Imara securities,” says the Botswana announcement published in December.
January 5th, 2010 by Tom Minney
The Botswana Stock Exchange has increased the number of indices from 5 to 8 with effect from 1 January. The new indices include the Domestic Companies Free Float Index (DCFFI – all domestic companies), the Local Assets Status Free Float Index (LASFFI – all companies with domestic asset status) and the Domestic Financial Service Free Float Index (DFSFFI). An announcement on the BSE website (www.bse.co.bw) says the base period for each index dates back to 1 January 2006 and the base value was 1,000.
January 5th, 2010 by Tom Minney
Botswana’s Non-Bank Financial Institutions Regulatory Authority (NBFIRA) is talking to the World Bank on technical help to update laws and develop rules. The authority aims to upgrade the Collective Investment Undertaking Act and to develop new regulations for asset managers, custodians and investment advisors.
The Botswana Stock Exchange (www.bse.co.bw) is primary supervisor for securities dealers and listed companies and in turn operates under NBFIRA supervision. general direction of NBFIRA. The Ministry of Finance and Development Planning is currently drafting a new Securities Bill and this satisfy NBFIRA which wants to update the BSE Act, according to a local media report.
NBFIRA’s 2009 annual report is reported as saying that it received all required reports from BSE and that the exchange did site visits to all securities dealers and held a disciplinary hearing against a securities dealer who did not submit audited financial statements on time and for irregularities in the statements.
The authority reports that lack of personnel has hampered capital markets supervision.
September 3rd, 2009 by Tom Minney
Absa Capital of South Africa says it is getting closer to a secondary listing on the Botswana Stock Exchange (BSE) of an Exchange Traded Fund. The NewGold Gold Bullion Debentures (NewGold) is the world’s third largest gold ETF and the largest on the South African Stock Exchange (JSE Ltd).
The listing could come by December, but first regulatory approval and finding a local partner is required, according to a report in Mmegi newspaper. Absa Capital is keen for the fund to classified as a local asset in terms of investment requirements, and they are discussing with asset managers and others to support it.
Absa Capital Associate Principal Dr Vladimir Nedeljkovic reportedly told a media presentation at the BSE that NewGold offers institutional and retail investors a new asset class and a chance to invest in gold in a cost-effective, secure and efficient way. The ETF was apparently developed in association with the World Gold Council. NewGold Gold Bullion Debentures are securities backed by the physical gold-bullion. Each NewGold Debenture is initially valued at 1/100 of one fine troy ounce of gold.
According to the report, the BSE suffers low liquidity and instruments such as this could help attract more trading and capital. Local fund managers reportedly invest up to 70% of their funds under management outside Botswana, partly due to lack of opportunities.