Icon Properties Limited has raised K14.7 billion through an initial public offering (IPO), issuance of shares for the first time to the public by a company through the primary market.
In its published media statement, the property firm says it has raised the amount through the sale of 1.68 billion shares at K8.75 per share and is expected to officially list on the Malawi Stock Exchange (MSE) on January 21 this year.
Meanwhile, the firm says it has refunded of 56 186 shares worth K491 630 with no shares taken out by its underwriters or sub-underwriters.
MSE operations manager Esnart Suleman said yesterday that the additional shares translates into a 36.5 percent shareholding of the public in the company.
She said Icon Properties listing is a good development for the MSE as it will increase the number of listed companies from 13 to 14 while offering investors more opportunities on the market.
“This may further improve liquidity on the market as the investment options increase. We hope that the listing of Icon Properties will also provide empirical evidence to other companies wishing to list that the market has the capacity to provide significant capital,” she said.
According to the statement, all applicants were allotted all the shares they applied for to the extent they complied with the terms of the offer except for the portion of shares which were not in multiples as required by the prospectus.
According to the prospectus, the company will have a Green Shoe Option–a provision in an underwriting agreement that grants the underwriter the right to sell investors more shares than originally planned by the issuer if the demand for a security issue proves higher than expected. The arrangement will give the company the right but not the obligation to buy oversubscribed shares to raise an additional K3.68 billion.
Directors would then retain the discretion to amend the allocation formula for the IPO as deemed fit, having regard to the strategic benefits derived from a diverse shareholder base, after consultation with the advisers.
Minority Shareholders Association of Malawi (Msam) general secretary Frank Harawa described the transaction as a success as it has given minority shareholders a chance to own stock in one of the largest property firms.
Earlier, Icon Properties Limited director Vizenge Kumwenda told journalists that the transaction presents a good opportunity to unlock the true value of a company, while at the same time giving investors an opportunity to make a decent return.
Icon Properties has 35 properties valued at K50.04 billion with a total lettable area of 72 630 square metres.
Its shareholding comprises 16 firms. n