[2008-07-31]  Six more companies to trade on CSD
The Botswana Stock Exchange is expected to add six more companies to trade on the Central Securities Depository System (CSD) next month.


The six companies that are expected to start trading on the CSD are Standard Chartered Bank, G4S, RPC Data, ABCH, MRI Botswana and BIHL.Currently there are three companies, trading live on the CSD, namely FNBB, Sefalana and Turnstar. BSE CSD manager Masego Pheto said in an interview that the additional companies are expected to start trading beginning August 18, 2008.

"Since we started trading the three counters in the system," Pheto said, "it has not given us any problem at all. So our wish is to roll out as many companies as possible in a short space of time."He said the delay in trading more companies was that transfer secretaries and issuers have not yet agreed on certain contractual terms.

Investors of FNBB, Sefalana and Turnstar had to open CSD accounts and deposit their share certificates for them to purchase and sell shares in the said companies.Pheto said the first exercise, which was meant to test the CSD system was a success.

At that time, Turnstar already had 83 percent of issued shares in the system. Initially, three companies were chosen to trade on the CSD because they were the most liquid stocks on the local bourse hence FNBB and Turnstar. While Sefalana was not among the most liquid stocks, it was included because other companies had not yet completed the required regulatory processes.As part of its efforts to develop the BSE into a world-class exchange, the BSE implemented the CSD with help from government at a cost of P5 million.

The CSD will make trading at the BSE more efficient and will ensure that delays that may be experienced in obtaining share certificates are eliminated, thereby protecting investor interests.Meanwhile, Business Today is reliably informed that MRIB might be de-listed from the BSE, despite its inclusion in the six companies that will trade to the CSD next month.An anonymous source said Southview Limited failed to get the required 90 percent support from public shareholders who are willing to sell or support the transaction.

The securities of MRIB on the BSE remain halted from trading pending its protracted takeover bid by Southview.Southview, which consists of VPB, Bifm and BOMAID, has offered to acquire 35.8 percent of MRIB, which they don't hold.

"They only managed to get 47 percent support, which still falls short of BSE requirements as prescribed in the Companies Act," the source said.The shareholders of Southview are still in negotiations reportedly, and they could still get the required support and remain listed on the bourse.

The board of directors of MRIB recently announced that it had resolved to support the acquisition of the company by Southview. It said in a statement that it had recommended to MRIB shareholders to accept Southview's mandatory offer as outlined in a circular dated June 13. The recommendation was made on the basis that the offer price of P1.25 represented a premium of about 20 percent over the volume-weighted average price of the shares over 30 days preceding the offer.

"The offer represents a premium of about 12 percent on the closing price of P1.12," the statement said. "It is a fair price and contains conditions that are in line with market practice."The rest of the terms and conditions contained in the circular remained the same.MRIB has been the target of takeover bids since losing its mainstay government tender a few years ago.

It contested the issue at the Lobatse High Court but lost, costing itself some hundreds of thousands of Pula.MRIB has also indicated that a spike in costs was due to the rise of imports sourced from the US through South Africa, a 14-percent retainer fee hike for the company's aircraft and an aggressive recruitment of paramedics targeted at enhancing the performance of its core business.
Source: © MMEGI 2002 - 2008