Real Insurance IPO response overwhelming
National Bank of Malawi (NBM) and Stockbrokers Malawi Limited (SML), the two institutions among those assigned by Real Insurance Company of Malawi Limited to conduct the company's Initial Public Offer (IPO) of its shares, have described the response by prospective shareholders as very overwhelming.
The two receiving banks, which are responsible for allocation of prospectuses to investing public interested to buy shares in Real Insurance, said this in Blantyre on Thursday during a 'media update', coming four days after the IPO commenced at NBM, SML, Standard Bank as well as Real Insurance on Monday.
According to Mark Mikwamba, Chief Executive Officer for SML, all 6000 prospectuses that were printed out finished by close of business on Wednesday.
"As of today, we are in the fourth day of the IPO, which began on September 1 and certainly, there has been overwhelming response from prospective investing public [both local and foreign]. However, at present prospectuses that were distributed to all receiving banks are finished.
"This is a very encouraging development and it demonstrates the confidence both local and foreign investors have on the Real Insurance IPO," said Mikwamba.
"The insurance company along with its advisors has resolved to print another set of [3000] documents to give chance to other interested investors, and by Monday next week they will be available in all designated receiving banks," added the SML boss.Mikwamba further said SML, which does approximately 70 percent of Malawi's stock exchange, will subsequently start disseminating information that will be guiding investors as regards to buying shares ahead of Real Insurance's listing on the Malawi Stock Exchange (MSE) on September 29.
He indicated that guiding information is very critical as it helps investing public to make right and informative decisions when they want to procure stocks.
Golomiko Muthari, General Manager for NBM Financial Management Services, Principle receiving bank for the IPO said they will make sure that the documents are well distributed the moment they will be issued. The IPO is expected to close on September 19.
"As soon as the prospectuses are issued, we will make sure that they are well distributed to all receiving banks. It is however our appeal to the general public that they should share information on the IPO," said Muthari, and according to him each prospectus comprises five copies.
Meanwhile, Real Insurance has disclosed that prospectuses will also be available on its website to provide an opportunity to other interested investors access the copies and all other necessary information about the IPO and the listing on MSE electronically.
Real Insurance Company of Malawi Limited is offering a total of 87.5 million shares to the general public at a price of K2.30. Thirty one [31] percent has been allocated to both foreign and domestic investors while four [4] percent (10 million shares) has been offered to the company's employees.
The insurance company expects to raise approximately K201 million from the selling of the shares and the capital will be invested in two major projects including establishment of a health branch [Real Health] and the opening of a Real Insurance Branch in the neighboring Mozambique.
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