Far Property Company (FPC), a company owned by Ramachandran Ottapathu and Farouk Ismail is aiming to list on the Botswana Stock Exchange (BSE) on or before the 6th of May this year if everything goes according to plan. Ottapathu told journalists on Wednesday that they are awaiting regulatory approvals to go ahead with the Initial Public Offering (IPO). A private placement has already occurred with an overwhelming response, Ottapathu disclosed. FPC, which is a variable rate loan stock company and was formed in 2010, has 178 properties located in Botswana and South Africa. The FPC listing price is expected to be 257 Thebe per share with an estimated market capitalisation of P977 million. After the listing, the two shareholders who currently hold 50 percent each will hold 39.5 percent each with 21 percent offered to new investors.
The size of the company being offered is 80 metres units which represent 21 percent of FPC’s units in issue post placement – a combination of sale and fresh issue. According to Ottapathu, the company focuses more on retail and industrial property and currently has no intention to venture into other portfolios such as office space as they believe such market is already saturated. The company was formed to cater for retail and industrial space in undersupplied areas which has led to demand by other providers of consumer services such as banks and clothing retailers. FPC anchor tenant comprises 50 percent of the tenant mix by Gross Lettable Area (GLA). The objective of FPC is to invest in properties that provide returns through income and capital growth; steady and stable returns over a long term with complimentary tenant mixes and assist FPC to leverage off the current African footprint along with an established anchor tenant of similar vision in order or expand and grow current presence on the continent among others.
FPC property portfolio is valued at P1.2 billion as at 30 June 2015 with retail accounting for 43 percent and industrial for 42 percent while the remaining 15 percent is for residential. The company has an occupancy rate 95 percent. In 2015 the company generated revenue of P82.3 million and is forecasted to generate P108.8 million in 2016 and P147.3 million in 2017. Once listed, FPC will join other listed variable rate loan stock companies such as Letlole La Roan, New Africa Properties, Prime Time Holdings, RDC Properties and Turnstar Holdings, some of which have been listed as far back as 1996. In terms of the future, the growth for FPC includes property development projects and acquisitions in both Botswana and South Africa and the company say it will use P100 million raised through the IPO for future growth. Future developments and acquisitions will be funded by both debt and equity.