Archive for the 'Dual listing' Category

Botswana supermarket raising $48m in JSE dual-listing

Botswana supermarket chain Choppies Enterprises Limited has launched a roadshow this week to raise $48 million and dual-list on the main board of the JSE Ltd on 27 May. It is offering to sell 117.4m new shares and 160m shares from existing investors.

Choppies was founded in 1986 and now operates 125 stores in Botswana, South Africa and Zimbabwe and employs over 11,000 people. It hopes to expand in Tanzania and Zambia, while Kenya and Namibia have also come up in reports.

The listing will be a secondary inward listing, so far only a few African companies have taken advantage of this opportunity offered by the JSE. The share price will be finalized after a roadshow which began on 11 May and a book-build run by Rand Merchant Bank. The offer should raise about R574m based on the current share price on the Botswana Stock Exchange.

Choppies store (credit Chronicle, Zimbabwe)

Choppies store (credit Chronicle, Zimbabwe)

Mr. Ramachandran Ottapathu, Group CEO said in a press release: “This is a really exciting moment in the life of the company. The listing on the JSE gives us further impetus for our ambitious growth plans. We are on track to have over 200 stores by the end of next year and we will be opening our first stores in Zambia and Tanzania by mid-2015. Choppies is a strong cash-generating business that has traditionally supported our organic growth of new store openings. The listing will allow us to fast-track the continued roll-out of new stores, unlock opportunities in new markets and fund acquisitions where opportunities arise.” Full details of the offer are available at their investor portal.

Media coverage on Reuters, Bloomberg and Business Day highlights the growth but adds that South African retailers Shoprite and Spar Group are also going after middle-income consumers in African markets. Bloomberg says it trades at 24x estimated earnings, compared to 21.4x for Shoprite and quotes Sasfin senior equity analyst Alec Abraham: “If Choppies can raise money at this price-to-earnings ratio, good for them. But it’s a very competitive space and companies are having to really invest to keep their market share.”

According to the company, Choppies has seen superior growth over recent years with a compound annual growth rate of 27% in total revenues from BWP2.4 billion for the year to 30 June 2011 to BWP5.0bn for the year to June 2014. Earnings before interest, tax, depreciation and amortisation (EBITDA) have grown at a CAGR of 19% to BWP352m in 2014, from BWP207m in 2011.

Mr. Ottapathu said: “We continue to establish ourselves in areas where we see great potential with the transition to branded convenience. We have the benefit of many years of experience identifying the right places to start up new stores for our target market. Our differentiated approach of partnering with local operators and sourcing from local suppliers provides us many advantages as we expand into new markets”.

Choppies locates its stores near taxi ranks and bus routes and is not in large shopping centres, Ottapathu told Bloomberg it has not experienced “significant pressure” on sales in South Africa. “We see growth opportunities in the current markets in which we operate and the retail penetration of the markets we are going into is low,” he said.

Nigerian Stock Exchange signs links to London SE Group

Paternoster Square with London Stock Exchange at right (credit: Wikipedia)

Paternoster Square with London Stock Exchange at right (credit: Wikipedia)

The Nigerian Stock Exchange (NSE) this week (18 Nov) signed a capital markets agreement with the London Stock Exchange Group (LSEG) to support African companies seeking dual listings in London and Lagos. It follows implementation earlier in 2014 of a new settlement process between the UK and Nigeria which significantly boosts the efficiency of listing and trading of ordinary shares of Nigerian companies listed in London and those of UK companies on the Nigerian market.
A top LSEG executive said it shows the global investment community is rushing to be part of the Nigerian story.
The agreement was signed by Oscar Onyema, CEO of the NSE, and Nikhil Rathi, Head of International Development, LSEG. Also present was Sir Roger Gifford, Country Head for the European Bank SEB, former Lord Mayor of London, and Co-Chairman of the UK Government’s Nigeria Emerging Capital Markets Task Force and Nigerian co-chair Aigboje Aig-Imoukhede, President of NSE.
Gifford said, according to the press release: “This is exactly the sort of ambitious project the ECMT Nigeria was launched to support. Nigeria is without doubt one of the most promising opportunities for capital markets development worldwide.
“An effective, transparent and well-governed capital market – across all asset classes – has the capacity to catalyse a nation’s quest for growth and development. In particular, functioning markets for corporate equity and debt reduce the dependence on bank capital and make investment securities available to a broader range of investors: institutional, private and international. This agreement will build on existing strong commercial and economic ties between the UK and Nigeria to our mutual benefit. ”
Mot of the previous dual-listings have listed on London’s AIM market although the milestone April dual-listing of Seplat (see below) saw Seplat head for the main market.
Onyema said: “Today’s agreement is another major step towards our goal of ensuring that all companies that have substantial operations in Nigeria are accessible to both Nigerian and international investors. In addition, we will be ensuring that our leading companies achieve the global profile and international institutional investment they deserve.”
The 9 Nigerian or Nigeria-focussed companies quoted on LSE have a collective market capitalisation of $14.2bn and include 6 oil & gas explorers and 3 major Nigerian banks.
The press release also quoted Rathi: “The agreement signed today is a reflection of the global investment community’s strong desire to be a part of the Nigeria story. As the world’s most international exchange, LSEG looks forward to building on the success of existing dual listings in Nigeria and London and partnering with the NSE to showcase the rapid developments in Nigerian capital markets and the Nigerian economy.”

Seplat dual-listing helping Nigeria bourse towards N1 trillion

Indigenous oil company Seplat was the first to make use of the linkages in April, when it raised $500 million in an Initial Public Offer (IPO) on both exchanges. Euromoney reported it was the first dual-listing and largest IPO from southern Africa since Dangote Cement in 2010. The London end was advised by BNP Paribas, Standard Bank, Citi and RBC Capital Markets, the Nigerian listing by Renaissance Securities and Stanbic IBTC.

The IPO added N28 billion ($161m) to the NSE market capitalization. The bourse aims to reach N1 trillion ($5.7 billion) by 2016 with oil and gas firms a key target.

Euromoney quoted Dolapo Oni, energy research analyst at Ecobank: “To list on the main board in London, Seplat required international accounting standards and the highest levels of corporate governance and transparency, which it has aimed for from its inception in 2009. Many other Nigerian companies are still not comfortable with disclosing this much information to the public and thus are not good enough to list on the main board.”

Miguel Azevedo, head of investment banking Africa at Citi, added: “It also represents the return of the sector to the London market, which hasn’t had a significant oil and gas listing since the financial crisis. Seplat really creates a new benchmark for international companies coming to the market.”

UK pushes emerging capital markets

UK Chancellor George Osborne announced the Emerging Capital Markets Taskforce on 9 April. It aims to unlock new opportunities for the UK financial services sector by helping to open and deepen capital markets in emerging economies through innovative collaboration between Government and private sector. This is part of the strategic public-private sector Financial Services Trade and Investment Board (FSTIB) launched in 2013 and chaired by HM Treasury. More details can be found via the FTSIB website.

London Stock Exchange offering to Africa

According to the London Stock Exchange, the listings of companies focussed on sub-Saharan Africa total 115 companies:
• 26 companies on the Main Market
• 3 Global Depository Receipt (GDR) listings on the Main Market
• 2 GDR listings on the Professional Securities Market (PSM)
• 84 companies quoted on AIM, the growth market
The LSE headquarters are in London and it has significant operations in Italy, France, North America and Sri Lanka and employs approximately 2,800 people.

londonstockexchange_logo
In its press release about a link-up with the Nigerian Stock Exchange, the London bourse says it offers partner securities exchanges and investors a broad range of international equity, bond and derivatives markets, including London Stock Exchange; Borsa Italiana; MTS, Europe’s leading fixed-income market; and the pan-European equities platform, Turquoise. Through its markets, the Group offers international business, and investors, unrivalled access to Europe’s capital markets.
Increasingly important are the post-trade and risk-management services including CC&G, the Rome headquartered central counterparty clearing house (CCP) and Monte Titoli, the significant European settlement business, selected as a first wave participant in the T2S (TARGET2-Securities) European settlement engine that aims to offer centralized delivery-versus-payment. The Group is also a majority owner of LCH.Clearnet, the leading multi-asset global CCP.
LSEG offers its customers an extensive range of real-time and reference data products, including SEDOL, UnaVista, Proquote and RNS. It owns FTSE which calculates thousands of unique indices that measure and benchmark markets and asset classes in more than 80 countries around the world. African exchanges have recently been taking strong interest in FTSE products that will help their visibility and data flows.
By purchasing Sri Lanka’s MillenniumIT trading, surveillance and post trade technology some years ago, the LSEG established itself as a leading developer of high performance trading platforms and capital markets software. According to the LSE press release over 40 other organizations and exchanges around the world use the Group’s technology, although smaller African such as the Dar es Salaam Stock Exchange are switching to other systems as reported on this blog, as Millennium IT’s focus changes.

Nairobi Securities Exchange invites Ethiopian firms to list

Kenya has invited Ethiopian companies to list on the Nairobi Securities Exchange in a ground-breaking move that would let them raise capital and trade their shares. The Ethiopian Government has been slow to support development of its capital market, hampering investment and private-sector growth.

Churchill Avenue, Addis Abeba (www.tourismethiopia.gov.et)

Churchill Avenue, Addis Abeba (www.tourismethiopia.gov.et)


The invitation came earlier this month as Kenya’s President Uhuru Kenyatta visited Addis Ababa to strengthen trade and other ties. According to Reuters he told a joint meeting of executives from both nations: “Kenya stands ready to begin consultations for the regulations and guidelines that would allow Ethiopian companies to raise investment capital and trade at our Nairobi Securities Exchange.”
Ethiopia has one of Africa’s biggest economies, a fast-growing population of 85-90 million, and a booming economy which is forecast to grow at over 7% a year for each of the next five years, according to the International Monetary Fund (World Economic Outlook, Oct 2013).
Foreign multinational companies such as Unilever, Danish pharmaceutical company Novo Nordisk and many Chinese and Indian companies are opening a wide range of operations, including manufacturing. However, many Ethiopian companies have found it hard to raise the risk capital to seize the many opportunities, despite a strong human skills base, as outlined in this perceptive article in Financial Times.
The Government is 100% owner of the largest companies such as Ethio Telecom and Ethiopian Airlines and endowment companies linked to the key political parties are also major forces in the economy. There has been a programme of privatizing many state-owned companies in farming, manufacturing and others but Government retains key strategic industries and Reuters says they are resisting calls to liberalize the economy.
Kenyatta took Kenyan companies to look for opportunities in Ethiopia including executives of dairy company Brookside, Equity Bank and telecoms operator Safaricom. The 2 countries signed a special status agreement in 2012, detailing various areas of co-operation in trade, energy and infrastructure. A large transport corridor could link Ethiopia and South Sudan to a new Lamu port in Kenya. Ethiopia recently opened a grid to export electricity to Kenya with $1.5bn financing from the World Bank and the African Development Bank.
Analysts said Ethiopia would benefit if its firms take up the offer to tap Kenyan capital and Reuters quoted a analyst from Nairobi-based Standard Investment Bank in a note to clients: “The advantage for Ethiopia for this arrangement would be the ability to provide companies with an inflow of capital without necessarily running the risks of an open capital account economy which Kenya is already accustomed to.”
The Nairobi bourse is the powerhouse of Eastern Africa and there are already many dual-listings in the region and plans to create further links and harmonization with Dar Es Salaam, Uganda and Rwanda securities exchanges.
One Ethiopian lawyer told African Capital Markets News: “There is no law that prohibits Ethiopian companies to trade on another stock market. The President of Kenya has made his intention clear on the subject and there is no clear rejection or acceptance from its Ethiopian counterparty. The Ethiopian companies could benefit much. Principally they will be able to implement corporate governance policies and procedures that are lacking today and also be competitive over the world market.”
According to Million Kibret, managing partner of BDO Consulting Ethiopia, confirmed to African Capital Markets News that lawyers agreed “there is no law or directive or regulation that forbids interested Ethiopian companies to register at the Nairobi Securities Market. If their enrollment requires investment it will be up to the National Bank of Ethiopia to allow same.”
Kenyatta said that Kenya exported goods worth $53.2m to Ethiopia in 2012 and imported goods worth $4.1m in the same year.

Africa’s bourses should work together to channel investors

Africa’s 24 stock markets should learn to work together better if they are to seize high levels of investor interest, said Nicky Newton-King, CEO of South Africa’s JSE Ltd (www.jse.co.za), Africa’s biggest securities exchange. She was speaking in an interview with agency AFP.
“The appetite for Africa is very, very high. I think everybody is trying to find their way, to participate meaningfully in that. All of us who are privileged enough to run exchanges, need to figure out that these waves of investor appetite aren’t yours by right. Once they come you have to be able to ride them properly. We should not be taking this as business as usual, this is a business opportunity.”
The International Monetary Fund forecasts the aggregate economy of sub-Saharan Africa will grow at around 5.7% next year, presenting a giant opportunity.
Newton-King said on 7 Dec that one way to channel the investor interest through African markets would be to make it easier to invest across borders and to improve liquidity in small markets so that assets can be bought and sold quickly.
The JSE already works closely with the Namibian Stock Exchange (www.nsx.com.na) and she said it is looking to make deals with two other African bourses. She said that creating a single pan-African bourse is not currently on the agenda and the JSE is concentrating on improving the continent’s financial plumbing including allowing cross- and dual-listings and easier order-routing.
“I think it is far more about collaboration. Were we not to have any exchanges on the continent I think we would have wanted to create a single exchange that would service multiple jurisdictions out of one legal base. That’s the most efficient way to do it, but I’m a bit of a realist. Once you try to do cross-border mergers and acquisitions, you run into much more trenchant issues of a regulatory nature, all of which stem from ‘how do we protect the local investor?’, ‘how do we make sure the local market grows?”
Newton-King identified liquidity as a key challenge to attract foreign investors: “Really big trades are not going to go to illiquid markets. The average day’s trade on the JSE is more than the average annual trade on Kenya and Mauritius put together. There are amazing companies in both of those countries.”
She said that allowing Kenyans to invest in joint-listed South African stock in KES shillings, or by allowing South Africans to more easily place orders into Nigerian stock markets would attract more foreign investors. She adds that there are benefits from cross-listing (securities being traded on more than one exchange), as the JSE learned when its leading shares moved to London: “When Anglo-American cross-listed in London, the amount of trades in Anglo-American increased. South Africa’s percentage of trade in Anglo-American decreased, but the decreased percentage was worth more. In those cases you have to think quite bravely.”
She was echoing a theme about Africa’s securities exchanges needing to become more liquid to serve the growing needs both of investors and of enterprises seeking capital.This theme has been strongly stressed by Sunil Benimadhu, CEO of the Stock Exchange of Mauritius, since he took over as Presdient of the African Securities Exchanges Association in October 2010, as reported on this blog.
The JSE has consistently offered to work closely to help other exchanges to develop and the author of this blog was GM of NSX when it linked its trading and broker systems in 1998-9. Exchanges in Southern Africa and in East Africa are stepping up the pace of collaboration. The Committee of SADC Stock Exchanges (COSSE) is working to forge more links,improve technology and other connections and take other steps to improve markets and boost liquidity, as reported here.

“Nigeria the new gateway to African capital markets”
The Nigerian Stock Exchange (NSE – www.nse.com.ng) aims to transform Nigeria into the gateway of African capital markets. Oscar Onyema, CEO of the NSE, on 12 Dec said this at a national competition for secondary and tertiary schools and colleges in Lagos. Priorities for the NSE management in 2013 will continue to be innovations in technology and new product development. Onyema promised more technology-based solutions and data services and said the NSE would advocate changes in policy and would also continue cleaning and restructuring, and making the market accessible.

JSE growth board AltX scores 100th listing with Osiris

The 100th company listed on the AltX growth capital board of South Africa’s JSE Ltd securities exchange this week. According to spokesperson Nicole Cheyne: “More than R1.25-billion (USD151.9 million) has been raised via this market,” since AltX was launched in 2003.
The latest listing, on 20 August, is Bermuda-based Osiris Properties International. Osiris’ primary listing is on the Bermuda Stock Exchange. According to a press release from the JSE, it offers investors a high-yielding property investment by acquiring quality undervalued property assets predominantly in the UK and Europe. CEO Peter Todd said “Osiris Properties presents an attractive opportunity for South African investors. Our secondary listing on AltX further enhances the company’s ability to raise capital.”
This was the AltX’s third listing this year, and the weak global economy is blamed for drops in listings both on AltX and the JSE main board, but Cheyne said this is expected to improve. Of the 100 listings, 21 had successfully transferred to the JSE’s main board and 16 had delisted, leaving 63 companies currently listed on AltX. Industrials are the biggest segment by number of companies, but financials constitute 46% of the overall market capitalization of over R12.5-billion.
Also on Monday, financial services company Prescient Holdings listed on the JSE main board via a reverse listing into PBT Group (previously Prescient Business Technologies).

Source: JSE Ltd press release.

Uganda’s power distributor Umeme says it plans Nairobi and Uganda IPOs this year

Uganda’s only power distributor, Umeme, said it plans to raise capital to invest in Uganda’s electricity sector through an initial public offering (IPO) on the Ugandan and Nairobi securities exchanges later in 2012. Umeme is a distribution company and is 100% owned by private equity firm Actis, according to this report on Reuters.
The news came on 6 July at the switching of 5 turbines to add 50MW to the power grid as part of the $860 million Bujagali 250MW hydropower project, one of Africa’s largest power schemes. Umeme has a 20-year electricity distribution concession. Managing director Charles Chapman says the company has opted for the IPO as electricity is now available – Uganda had been suffering power cuts before Bujagali capacity was added – and there was agreement on regulatory targets.
The company would not say how much it hopes to raise and has not finalized plans for the IPO, but Reuters suggests it could be 20% of the shares. The report quotes Chapman: “The initial public offering (IPO) will support Umeme’s capital raising initiatives to finance the continued development of the electricity distribution network, including projects such as prepayment metering and energy loss reduction. We believe that Umeme will be stronger, more transparent and accountable with the input of our customers and employees as shareholders.”
He adds that customers are up to about 460,000 in 2011 from 354,839 in 2009. After power sector unbundling, power in Uganda is generated by the Uganda Electricity Generation Company and transmitted to Umeme by the Uganda Electricity Transmission Company.
According to this blog story, Umeme has already put in its application to the Capital Markets Authority in Uganda and has appointed Stanbic Bank (Uganda) as Transaction Advisor and African Alliance (Uganda) as Sponsoring Broker. Writer Angelo Izama comments: “The company is a safe investment given its monopoly and demand from customers. Many who worry about the risks it faces will look to political risk something to which we will return. Suffice to say that a great degree of the risk will likely be offset when the company lists given the divesting of its ownership to locals.”

Hana Mining could speed trans-Kalahari railway

The dual-listing of Hana Mining Ltd last week on the Foreign Venture Capital Board of the Botswana Stock Exchange (www.bse.co.bw) could bring a giant new cross-Africa railway closer. Hana is also listed on the Toronto Stock Exchange venture board and the Frankfurt exchange. It plans a copper-silver mine near Ghanzi.

The company’s shares started trading on the BSE on 23 May, according to an announcement. On 14 May the company released its most recent (NI 43-101 compliant) preliminary economic assessment which calls for US$285.5 million initial capital expenditure to create a 10,000 tonne per day open-pit mining and milling operation. This is expected to produce approximately 66.4m pounds of copper and 878,000 ounces of silver annually over a minimum 13-year mine life. It says the Ghanzi property is one of Africa’s premier future copper-silver resources.

Hana Mining’s CEO and Chairman, Marek Kreczmer, was quoted as saying: “The listing of the company’s shares on the BSE is an important step in enhancing the relationship of the Company with the government of Botswana in that it allows the people of Botswana to invest directly in the company and gives the company access to some of the largest investment funds in Africa. Also, by establishing a listing in Botswana, we are aligning the goals of the Company with the people of Botswana.”

The Ghanzi Project covers 2,149 square kilometres in the centre of the Kalahari Copper Belt in northwestern Botswana. Favourable geology extends over an estimated strike length of 600 kilometres. The closest existing railhead to port is at Gobabis, in Namibia, approximately 550 km away. A feasibility study has been carried out with funding from the World Bank and the governments of Botswana and Namibia on completion of a rail link to connect Botswana with the Namibian port of Walvis Bay, on the Atlantic coast. More mining projects will make the railway more likely.

Construction is well advanced on a 600MW expansion of the government-owned Moropule Power Plant, which secured US$825m project funding in May 2009. The Trans-Kalahari highway passes within 15 km of the Ghanzi property, which is also near local population centres and workforce.

JSE stock exchange unveils new Africa strategy

This morning (2 April) South Africa’s securities exchange, the JSE Ltd, announced a revised strategy to attract more listings from African countries, as they say international interest in investing into the continent’s growth story continues to soar. The JSE is closing its Africa Board and moving the 2 listed companies onto the Main Board (listing requirements for the Africa Board are the same as for the Main Board) or to Alt-X if they are growth companies. The JSE is also stepping up trading in depository receipts (DRs) and offering a broader range of exchange-traded funds and debt instruments.
Siobhan Cleary, Director of Strategy and Public Policy at the JSE, said in a press release: “The JSE’s existing African offering includes 12 African companies. In future, there will be no differentiation (for listing purposes). For equities, this will mean that we will list the companies on the Main Board or AltX as applicable. We will also actively market and profile the African companies that are already listed.”
She says the move is driven by demand for capital and also by the increasing supply of capital from investors. African consumer markets are increasingly being targeted by local companies and companies from overseas, including a growing wave of foreign direct investment activity. Other very active channels for investments are private equity funds, hedge funds and other investors. “We think it is time that stock exchanges started to play an appropriate role in channelling the investments.”
In October 2011 South Africa’s National Treasury announced that companies previously viewed as foreign listings would in future be treated as domestic and this makes it easier for South Africans to invest in JSE-listed African stocks and makes it easier for foreign companies to raise capital. South African institutions will apparently be able to include JSE listed companies among their domestic asset holdings. Second, the JSE has developed good relations with several stock exchanges on the continent through the African Stock Exchanges Association and the Committee of SADC Stock Exchanges. Third, there are increasing investment flows into the continent’s markets and more funds focused on the region, seen as high growth compared to many world markets.
Nathan Mintah, Chairman of the JSE’s Africa Advisory Committee, commented: “This evolution in JSE’s strategy is a step in the right direction in the quest to increase capital flows into the rest of Africa. Offering issuers and investors the ‘whole JSE’ market platform for access to instruments across the capital structure in equities, mezzanine, and fixed income combined with the JSE’s liquidity will clearly benefit all stakeholders and serve as a catalyst for product innovation in areas such as exchange traded products for the rest of Africa.”
The JSE is diversifying the instrument range it offers investors from the rest of the continent. Cleary says: “We already have four interest-rate instruments from the rest of the continent, as well as an African exchange-traded product. We will give increased focus to listing further debt and quasi-equity products in future. These will also include DRs, which are traded like shares and offer investors the same economic, corporate and voting rights as holding underlying shares directly. DRs enable issuers to reach investors located outside their home markets while reducing the risk of cross-border investment.” The JSE altered its listing requirements last year to accommodate DRs, which will provide a way for African companies to raise capital on the JSE without requiring a secondary listing. DRs are applicable for African companies regardless of whether they have an existing listing on an African exchange or any other exchange. Freely traded in South African Rands, this will allow African companies to market themselves to both South African and international investors.
Cleary says there is a pipeline of companies interested and she expects more African listings this year. The JSE is competing with international exchanges such as London and New York for key listings, and also with Australia and Toronto for mining listings. Recently Nigeria’s Aliko Dangote said (see article in Financial Times, for instance) he would take the $11bn Dangote Cement for a London listing in 2013, and last year Zambia’s Zambeef also opted for London.
The two listings on the JSE Africa Board, launched in February 2009, were Trustco from Namibia and Wilderness Safaris from Botswana. The JSE says both prefer to be ranked with their sector peers and in industry sectors. Quinton van Rooyen, Trustco Group MD, commented: “This repositioning of Trustco allows the company, whilst keeping its African identity, to be benchmarked against its peers, on a world-class platform. This can only be beneficial to Trustco and the extensive African investment community.” The JSE is also pledging roadshows and analyst events to highlight the African companies from outside South Africa.
The JSE believes that its approach provides a workable solution to the sometimes complex issue of investment on the continent. The JSE’s approach also contributes to the development of markets within their own economies. Cleary added: “There is an opportunity for the JSE to work with these exchanges and various development institutions to build capacity on the continent. It also gives the JSE the opportunity to evolve its Africa strategy. This has meant looking critically at what issuers – companies, governments and others – from the rest of the continent are looking for, and aligning their needs with the JSE’s objectives,” says Cleary.

Tanzanite miner Richland heads for Dar-es-Salaam bourse listing

Tanzanians are set to share the gains of the exciting blue-violet gems that bear their country’s name, tanzanite. Richland Resources Ltd (richlandresourcesltd.com), listed on the London Stock Exchanges’s AIM market (ticker: RLD) says that it plans listing at the Dar es Salaam Stock Exchange (www.dse.co.tz) by April, according to local press reports reprinted on the company’s website today (8 Feb).
According to one report in East African Business Week, Dotto Medard, the firm’s corporate and PR manager, said: “We are in the final stages of listing on the Dar bourse, largely to avail opportunity to as many Tanzanians to be part of the tanzanite industry.” Apparently all Richland’s issued capital will be freely traded on the DSE and will be available to Tanzanians to buy and sell on the market without any restrictions on the number or shareholding available for Tanzanians. Another report in Tanzania Daily News says the listing will be completed by April and there may be a float of 20% of the share capital.
On 6 Feb the coloured gem stone miner announced that new tests have indicated the life of its Mereleni mine in Tanzania could be extended by 30 years. The total indicated resource of the mine is now estimated at 105 million carats, up from 72m carats. Between 2004 and 2011 the mine produced over 11.5 million carats from around 266,000 tonnes of material. The new tests have made the asset “JORC compliant”, conforming to internationally recognised measurement standards.
The company is involved in tanzanite mining, processing, cutting and distribution. The local subsidiaries are Tanzanite One Mining will continue to operate with its name along with Tsavorite One Mining Limited, Tanzanite One Trading Limited, Tanzanite Laboratory Limited and Urafiki Gemstone EPZ Limited. It has recently moved into other coloured gemstones, including tsavorite and sapphire. It says TanzaniteOne Mining has been one of the largest mining contributors to tax in Tanzania. It has invested over US$100m through mine acquisition, development and ongoing mining activities and directly employs 650. Mr. Medard pledged: “the Company will continue to support significant growth in the Tanzanian economy, through export earnings, tax and royalty payments.”
It is the largest miner and supplier of rough tanzanite and uses its position to influence the entire channel, from mine to market (it markets tanzanite globally), ensuring maximum stakeholder value at each stage. It requires large capital investment as tanzanite mining is currently operating at down dip depths of over 900 metres and needs sophisticated equipment and experience. Other expansion plans include a modern plant for cutting and polishing the tanzanite stones under the supervision of Urafiki Gemstone Ltd.
Richland backs successful community projects including support to primary and secondary schools, medical dispensary, community centre and water for people and livestock. It also provides assistance to small-scale miners including geological, mining, surveying, safety and logistical. tanzanite gem is its unique beauty, plus the finite nature of a single known resource at the foothills of Mount Kilimanjaro in northern Tanzania.