DEPOSIT-taking microfinance institution, GetBucks Zimbabwe has announced plans to raise US$3,2 million through an initial public offering on the Zimbabwe Stock Exchange, the first since engineering group Zeco listed on the local bourse in 2007.
An IPO is the first sale of stock by a private company to the public. IPOs are often issued by smaller, younger companies seeking the capital to expand, but can also be done by large privately owned companies looking to become publicly traded.
GetBucks Zimbabwe, currently has a US$11 million loan book and is offering unsecured loans for which repayments are deducted at source. The company sees its loan book growing after the capital raising initiative.
“GetBucks Zimbabwe intends to raise a total amount of US$3 200 000 by way of an IPO through the subscription of 93 567 251 ordinary shares in the Company at a subscription price of US$0.0342 per share. On conclusion of the IPO, it is envisaged that the entire issued share capital of GetBucks Zimbabwe of 1 093 567 251 ordinary shares will be listed on the ZSE,” the company said on Monday.
South Africa’s GetBucks owns 55% shareholding of GetBucks Zimbabwe with the remained being controlled by local investment firm, Brainworks.
The company commenced operations in 2012 as a credit only microfinance institution, and the business has over that short period of time, grown into one of the leading microfinance lenders in Zimbabwe.
“The strategic objective of GetBucks Zimbabwe is to retain and grow its market share in Zimbabwe through a sustainable business model that offers competitive interest rates while managing its cost of funds,” reads the prospectus.
“To that end, GetBucks Zimbabwe was issued with a licence by the Reserve Bank of Zimbabwe to operate a deposit taking microfinance institution which will allow the Company to increase its product offering and continue to drive financial inclusion at the low end of the market. The license was issued on 16 July 2015.”-Staff Writer