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Altvest Capital Limited is preparing to list on the AltX market of the Johannesburg Stock Exchange (JSE) after offering four different classes of shares in an Initial Public Offering (IPO). The offer will close at 12 noon (South African time) on 1 October 2024.
If the offer is successful, the company will move from its existing listing on the Cape Town Stock Exchange (CTSE). The AltX listing under the “Diversified Financial Sector” would happen on 14 October 2024.
Altvest aims to create a financial platform to bring alternative assets such as private equity, agriculture, property, fintech, blockchain and renewable energy within the reach of retail investors. It is working closely with the Easy Equities trading platform. This IPO is part of Altvest’s broader strategy to give retail investors access to alternative investments. The listing on the JSE marks the next phase of growth for the company, following its existing presence on the CTSE.
Warren Wheatley, founder and CEO of Altvest, says in a press release: “Our IPO is a direct challenge to the status quo. Historically, smaller companies have struggled to raise capital because of systemic barriers that favour large institutional investors and high-net-worth individuals. We’re flipping that model on its head by giving ordinary South Africans the tools and the access they need to participate in these high-potential investments.”
For more information about the IPO, including the details of the various shares on offer, potential investors can refer to the prospectus available on Altvest’s website.
Details of the offer
Altvest Capital is offering a variety of shares, each linked to different assets within the company’s portfolio. The offer includes:
- Ordinary Shares: 1,000,000 available. These shares provide general equity exposure to Altvest and the company says these are “for investors looking for long-term growth in a well-diversified, innovative investment company.” Ordinary Shares are offered at R6.50 each.
- A Shares: 3,924,674, these are linked to Altvest’s investment in Umganu Lodge, a luxury lodge located near the Kruger National Park. These shares provide a direct interest in this hospitality asset. A Shares at R1.80 each.
- B Shares: 718,844 B Shares are tied to Altvest’s stake in the Bambanani Family Group, which operates in the family restaurant and entertainment sector. B Shares at R11.00 each.
- C Shares: 29,833,894 offered, these are connected to the Altvest Credit Opportunities Fund (ACOF). This fund provides debt financing to small and medium-sized enterprises (SMEs) in South Africa, particularly those that have limited access to traditional banking services. C Shares at R3.20 each.
More details of the investments can also be found in the abridged prospectus here.
Key Dates and Subscription Details
The IPO opened on Friday, 13 September 2024 at 09:00. The important dates to note are:
- Closing Date: 1 October 2024, at 12:00 noon
- Notification of Share Allocation: 2 October 2024
- Offer Price and Results Released: 3 October 2024
- Last Day for Payment: 7 October 2024, at 12:00 noon
- Listing on JSE AltX: 14 October 2024
Payment for shares will follow a T+7 settlement process, which is different from the usual T+1 process, meaning that investors will need to settle payments within seven business days after the allocation of shares.
The IPO will only proceed if there is a minimum subscription amount of R6,500,000 for the Ordinary Shares, with R2,500,000 underwritten by WGW Capital Proprietary Limited, an associate of Altvest executive director Wheatley. If this minimum subscription amount is not reached, the IPO will not proceed.
This article by Tim Cohen in Daily Maverick notes that it is the first book build that is taking place exclusively on EasyEquities, a platform which many investors use for their shares and which has done private placements before.
Moving from Cape Town Stock Exchange (CTSE)
Altvest’s listing on the Cape Town Stock Exchange (CTSE) will be transferred to the JSE AltX board following approval from the company’s shareholders. Altvest Shares will be delisted from the CTSE at the close of trade on 11 October 2024, and trading on the JSE will commence on 14 October 2024. This transition is part of Altvest’s strategy to increase visibility and access to a broader investor base.
The Cape Town Stock Exchange was originally launched as 4 Africa Exchange (4AX) in 2016, and formally commenced operations on 1 March 2017. It relaunched to become The Cape Town Stock Exchange in October 2021. The CEO is Eugene Booysen, and the head office is in Cape Town but there is presence in Johannesburg, and they are open to listings aiming at helping smaller and medium businesses all over Africa to raise capital.
Altvest obtained a secondary listing on A2X on 6 September 2022. Altvest’s A Shares, B Shares and C Shares were listed on the CTSE on 22 September 2022, 12 December 2022 and 5 September 2023 respectively. Altvest says the Ordinary Shares have a market capitalization of R60m and it has raised about R321m of capital associated with three investee companies since listing on the CTSE.
Risks and Considerations
Potential investors in Altvest should be aware that the A, B, and C shares being offered are classified as hybrid financial instruments, as per section 20 of the JSE Listings Requirements. These instruments carry risks, and investors should ensure that they fully understand the nature of these shares and their potential exposure to those risks. The JSE’s approval of the listing should not be interpreted as an endorsement of Altvest or its shares.
Altvest’s IPO has been facilitated by various advisors:
- Corporate Advisor: Questco Corporate Advisory
- Legal Advisor: RDKM Advisory
- Independent Reporting Accountants and Auditors: BDO
- Bookrunner: EasyEquities
Once the listing is transferred, the shares will need to be traded through the EasyEquities platform or through another JSE stockbroker.
