By Peter Egwuatu

SIM Capital Alliance Limited, a joint venture between Capital Alliance and Sanlam Investment Management has urged the investing public to invest in the ongoing Initial Public Offering (IPO)of its Collective Investment Scheme to raise N5 billion.

The offer initially billed to close on October 7, 2010 has been extended to October 14, 2010 due to the public holidays observed last week.

Chairman, SIM Capital Alliance Limited, Mr. Afolabi Oladele disclosed to the capital market community that investors who invest in the Fund will enjoy the benefit from the competitive returns they stand to gain from the disciplined investment approach of the Fund.

According to him, “ investors stand to minimise their risks as a result of portfolio diversification as the Fund will also invest in unlisted equities once approved by the Securities and Exchange Commission (SEC)

He stressed that the primary objective of the Fund is to achieve long term capital growth by investing in listed Nigerian equities which the Fund Manager has identified as being undervalued and offering above average growth potential, and other securities as approved by the SEC from time to time.

Continuing he said, “ the Fund will pursue the objective of maximising returns by investing in companies listed on the Nigerian Stock Exchange (NSE), thus enabling investors gain exposure to a concentrated portfolio of value stocks. The Fund may also invest in fixed income securities and in unlisted equities, once the Asset Class has been approved by SEC”.

Stanbic IBTC Bank Plc is the Issuing House to the IPO, Stanbic IBTC Stockbrokers Limited is the stockbroker to the Issue and Leadway Capital and Trusts Limited is the Trustees.

SIM Capital is specifically offering 50,000 000 units of N100 each at N103.50 per unit in the SIM Capital Alliance Value Fund.

Commenting on the target investors, Oladele stressed that the Fund is meant for investors with long term horizons including institutional investors such as Pension Funds, Insurance companies and savings and investment clubs as well as high networth and retail investors.

According to the prospectus of the offering, the directors of SIM Capital Alliance had stated that in the absence of unforseen circumstances and based on the assumptions made in respect of the Fund, profit forecasts for the years ending December 31, 2010, 2011, and 2012 are as follows: Dividend income N127.50 million, N159.59 million and 194.16 million; Net income/loss before tax N1.236.03 billion,

N1.336.66 billion and N1.636.18 billion; Net income/loss after tax stood at N1.223.28 billion, N1.3200.70 billion and N1.616.76 billion respectively.