Breaking News

Pinnacle Point set for N1.9bn rights issue

By Peter Egwuatu

Arrangements  have reached an advanced stage for Pinnacle Point Group(PPG) Plc, a South Africa based company to float a rights issue of N1.9billion in the Nigerian capital market.

The company’s financial adviser, Goldbanc Management Associates (GMA)Limited disclosed this to newsmen in Lagos, weekend, saying, “ Pinnacle is awaiting approval from the regulatory bodies in the Nigerian capital market to float a rights issue which will commence by October31, 2009.

Speaking at a press briefing, Chief Operating Officer, Goldbanc Management Associates Limited, Mr. Kayode Tijani said, “ Pinnacle Point Group Limited would be issuing a total of R250 million Rights (about N4.750bn) , out of which R150 million (N2.850bn) has been picked up by ABSA, a major investor in South Africa , while the remaining R100 million (about N1.9billion)  is to be issued to both existing and new investors.

He explained that the rights issue being issued by Pinnacle was unique in the sense that both existing and new investors can partake in the offer.

Tijani, explained that the proceeds from the rights issue would be used to undertake the Lagos Mega City projects, in which Pinnacle Group has been appointed as  the major property developer.

According to him, “ Because the company is listed in both Johannesburg Stock Exchange (JSE) and Nigerian Stock Exchange (NSE), both existing shareholders and prospective shareholders can participate in the offering. This is so, because in JSE, the regulation allows for both existing and prospective investors to partake in rights issue. So we are using that leverage to allow our Nigerian investors who are not shareholders to buy into the company.”

He further noted that the rights issue can be bought on the floors of the NSE, adding, “ Where an investor could not buy from the floors of the Exchange. The investor could approach GMA to get the rights issue.
According to him, “ 10 per cent of the company’s shares are held by Nigerians and the rights are domiciled in South Africa for now. Because of the dual listing of the companies’ shares , both existing and new investor can still partake in the offering as Nigerians are free to buy from either of the Exchanges. We, the financial adviser will help Nigerians who are not yet shareholders to partake in the rights. Even the Lagos State Government has stake in the company as the owners of the areas to be used in building the estates would be provided with job employment and made to own shares in the company.”

Continuing , he noted , “ Existing voting pool agreement between major shareholders is to be cancelled, while existing loan from GMA of US$5 million must be converted to equity at same price as rights issue. Also, ABSA will furthermore convert existing debt of R70 million (about N1.330bn) to share capital at rights issue price.

In his own speech, Mr. Hennie Pretorius, Chief Executive Offer, Pinnacle Point Group Limited, said the company specialises  in obtaining rights to develop vacant land and land development.
“ We focus on residential and leisure developments. Features of developments are family living, lifestyle, sports, golf, security and hotels. Our current business units comprise: Property development which is further subdivided into; leisure resort developments, Residential developments, Retirement developments, golf course ownership and management.  All these are what we are going to provide in the Lagos mega city, including the building of Badagry Pyramid that will serve as a source of power” he stated.

On its financial position, Pretorius, said, “Pinnacle market capitalisation stood at R641billion , Net asset value of N768billion, Combined independent valuation of property portfolio at R6019billion, with most recent independent valuation of business at R4286 billion.”


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.