Archive for October, 2011

Monday, October 24, 2011 @ 09:10 PM
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FSE Listings: The Time Is Now to Invest In South Africa and Africa in General, the time is now to List your Company!

Africa has seen an enormous increase in investment capital in the last 5 years, and more money means more building. One of the bitter ironies of the global financial crisis is that even the most risk-averse institutional investors who sustained devastating losts focusing on developed markets have been taking more risks in search of growth rates that are hard to find in Europe and the US.

Private capital flows to emerging markets will balloon to $833 billion this year from $581 billion in 2009, according to the Washington-­based Institute of International Finance.

World Bank Vice President for Africa Obiageli Ezekwesili a few weeks past said from the London Stock Exchange, that investors worldwide need to invest in Africa and its budding capital markets. She urged investors who are in search of the right market at a time of growing fears of a global recession to “rediscover Africa”.

The reaility is that she is right, and that from Bonds, Debts, Equity Placements, and solid domestic products, Africa is in for a Boom Market.

Africa is experiencing GDP growth rates, and the projections are to increase year on year roughly 5%  or more to 2013. Building African focused businesses and listing African based companies on the Frankfurt Stock Exchange is one of the best routes to go as the focus is on Africa Capital Markets while other markets go into their worst quarters and Africa are among the best returns on investment. South Africa continues to be the strong growth market in Africa, with the Sub Saharan-Africa being an attractive market to invest in, including Uganda, Tanzania, and Nigeria.

Oxford University Professor, Paul Collier, which found the return on capital for over 950 African enterprises to be on the average 11 percent higher than in Latin America and Asia, and 70 percent more profitable if compared against similar Chinese firms.

When is the best time for African companies to go public and gain global awareness and access to capital? When you are winning the beauty contest in capital markets, and now is the time to list your African businesses more than anytime before.

African investment opportunities are ideal for European Investment markets, who are familiar with having made more capital investments into Africa directly in the past. In addition, China and Korea are investing heavily in Africa. The most common market with the largest cross section of investors from Foreign Markets is the NYSE-Deutsche Boerse Group and the Frankfurt Stock Exchange of which the group owns.

Why the Big African Boom?

Deregulations in the emerging markets in general starting in the 1990’s has lead to friendlier and more profitable markets of which businesses, consumers, investors, and development partners are bullish. Changes in policies, from reserve controls and foreign ownership to methods of protecting foreign investors through insurance and bonds, developing Countries and Africa are seeing more money.

More money means more building. Building of businesses, building of infrastructure, building of educated workforces, creation of jobs, and access to resources and growth; Africa has the building blocks.

African stock markets however still have limited liquidity and relative small size, African companies and South African companies need to look beyond just Africa and look to Frankfurt for primary and or dual listing of their firms to take advantage of the boom and momentum of international investment focus on Africa.

It is true African Stock Exchange, with the exception of the Johannesburg Stock Exchange have been doubling their market capitalization from 1992 to 2002, with markets like Lagos Stock Exchange bullishly boasting plans to bring its capitalization of $40 billion to $1 trillion in five years.

However, it is difficult to look past the illiquid markets of African Capital Markets compared to the liquid Private Equity investments into African companies listed on Foreign markets.

Africa has invested in change, now is the time to change the investors mind and bring the foreign capital in to the structure that has been built for them.

Opportunities are abundant for:

–          Agriculture, agribusiness, agro-processing

–          Infrastructure development and construction, transportation, and logistics

–          Resources and Energy

–          Upgrade and penetration within the ICT sector, expanded broadband, mobile networks, banking, and internet access

–          Business to business services

–          Water purification, desalination, and transmission

Africa has the distinct opportunity of luring some of the 85-90 million labor intensive jobs in light manufacturing that China will likely move offshore in the next 3-5 years from wage pressure.

Africa is not afraid to make public capital investments and utilize aid funds to enable reforms and capital infusions into telecommunications, infrastructure, and logistics so that private capital can help turn the loss-making progress initiatives into profitable projects taken to their full capacity of capital earnings.

Why Invest In South African Businesses and Trade?

In this global market, there has been a great deal of attention given to the African footprint of the BRIC economies and the fact that South Africa is the predestined main trade, investment, and political partner for Sub-Saharan Africa. It’s economic structure, location, participation in multilateral trade agreements (SADC Region), and stable domestic capital market are the favorable conditions South Africa brings to the table.

In addition, the rest of Africa believes this rumor, and it’s a good one. In actual fact, much of the Entrepreneurship in the African Continent at one time or another has seeked capital within South Africa, traded with South Africa, or has looked at opportunities to grow into South Africa. South Africa trades with Africa, providing technology intensive product and receiving resource-based products in return.

Further harmonization between the SADC and the Common Market for East and Southern Africa and the East African Community will only continue to grow the opportunities.

High growth markets of African Countries or projects focusing on feeding the South African business opportunities include:

–          Energy companies and the supply of energy to South Africa

–          Oil, precious stones, base metals

–          Agricultural products

In general, African investments into these sectors are stable for both domestic and international consumption.

South Africa profits from the relationships in its neighboring markets though specialized manufacturing, machinery, vehicles and electronics, and to some smaller degree oil and agricultural products. South Africa tends to cater to African tastes for customized machinery, and this extends their growth into the markets, despite international competitors.

As mentioned prior, the booms happen years after and during deregulation and friendlier business environments that are the disruptive changes in economics that allow for higher returns than other markets globally. Some good suggest that plans for this Africa-wide free trade area covering 26 nations as negotiations continued and the structure eventually may unfold, that this could be a positive change to further create the boom in Pan-African business opportunities. This continent is no longer an emerging market by definition, but rather a Frontier market with young populations, high growth, and diversity.

With this high growth potential, Financial Services companies within South Africa and Africa in general will become attractive investments, as suggested by the World Bank Vice President who pushed on London for investment into Africa’s Capital Markets. The opportunities need to be financed and steered so that the growth is manageable and effective. Public company vehicles also allow for good governance, process, and status internationally. Listing your firm on the Frankfurt Stock Exchange or your business opportunity gives the company access to much needed capital from foreign markets.

In our opinion, South African businesses are the likely port of entry for investors interested in the continent, despite other emerging markets or the local Capital Markets. The businesses themselves, the equity, and the secured investments. In order to access capital, secured and insured investments, and international exposure, the Frankfurt is one of the leading sources for your firm to reach all three.

Financing of Afican Companies Listed On Frankfurt

Cashflow companies that can service debt or return on investment to shareholders with growth would be eligible for listing Bonds, Securitized Loans, and Structured Financing. On occasion the assets of firms are not enough, and the insurance firm and Banks issuing the Bond require collateral above and beyond the asset to fast track capital. By listing a firm on the Frankfurt Stock Exchange with FSE Listings Inc, you can utilize the listed companies shares in conjunction with the company’s assets as liquid security, improving both the chance of getting the required funds and increasing your rating to a AA Rating. Firms who work with FSE Listings Inc are willing to insure and finance African focused companies up to 5 million euro who fit the criteria for funding.

About FSE Listings Inc

FSE Listings Inc is the leading listing firm for the Frankfurt Stock Exchange listings outside of Germany and the recognized leader bar-none over any other firm for non-German Companies. With offices in Spain, UK, South Africa, Guatemala, Mexico, Canada, the USA, Netherlands, Vietnam, Hong Kong, Philippines, Thailand, Mozambique, and Ireland. Many firms have in-house law firms, which increase your cost of listing and hinder your process, FSE Listings Inc utilizes the best and quickest law firms, listing partners, designated sponsors, and local service providers. In addition, our finance partners have the access to innovative proven mechanisms of getting the capital and commitments your firm requires in a timely and reliable fashion.  By going with our firm, you get all of the best professionals as a one-stop service agreement. http://www.fselistings.com

Contact info@fselistings.com

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Monday, October 24, 2011 @ 09:10 PM
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South Africa Financial News: How to List Bonds from SOUTH AFRICA and financing with Frankfurt Stock Exchange Listings

The ideal way to fund a company from SOUTH AFRICA is the process of creating securities by pooling together various cash-flow producing assets. The securities are then sold to investors, securitization, in its most basic form is a method of financing assets. FSE Listings in SOUTH AFRICA focuses on creating the securitized bonds. The process is relatively straight forward:

  • Fill-in the corporate documents to see if you qualify,
    including business plan and any third party valuations
  • Analyze whether the cash flow can service the
    securitization
  • Perform the third party valuation of the company and
    sign-off by a Lawyer on the documentation
  • Listing of the company, such as a Stock Exchange Listing
  • Insure the bundle of assets and the stock exchange listed
    shares into a Bond
  • Utilize a network of sophisticated institutional
    investors looking for AA Rated Bonds of this nature

The entire process takes 9-10 weeks, including listing, bonding, financing, and receipt of funds.

Any asset may be securitized as long as it is cash-flow producing. Shares and assets are generally cash-flow producing. Carbon credits in their own right can be considered cash flow producing, sales projects, production such as in Oil, Gold, Silver, Copper, mining is cash flow producing.

In the current economic environment, the assets and cash flow of a company from SOUTH AFRICA is not enough to instill confidence in the investor. Shares in their own right are cash flow on the basis that a market can be made, and the public will purchase the shares. On this basis, the shares offer a higher level of cash flow than in a private company. The concept of bundling the listed firm’s shares with the assets and cash flow of the company to finance the firm is not unique, what is unique is that FSE Listings Inc can list the firms shares on the Frankfurt Stock Exchange in 3-6 weeks, insure the firm in 3 weeks, and finance the company immediately upon becoming a bond
through the financing network.

Cash flows generally are the underlying financial assets which serve as the principal source of payment to the investors, whereby the securitization basically allows for upfront funding of assets and development of the company now based on future cash flows to service the funding, such as an asset and share backed securitized bond giving a 10% rate of return guaranteed.

The asset and cash flow based bonds secured by corporate shares, insured by an insurance firm for a return on nvestment is a AA rated bond, not a junk bond as most corporate bonds turn out to be in SOUTH AFRICA.

Companies sell bonds when they want to borrow money to grow our expand their business, the process is qualifying the ability to service the promises to the investor for the interest payments and maturity at a future date. The specialized Bonds that work best for projects from SOUTH AFRICA have secured assets and shares which can be seized if the company fails to pay interest or return the original principal amount when the bonds matured, the difference and competitive advantage is that the return on investment is also insured for investors, so the risk is less than a typical bond making it more attractive and easier to finance your firm from SOUTH AFRICA.

Unsecured debts which are convertible into shares are most commonly known as convertible debentures. The difference between purchasing a convertible debenture and purchasing asset and shares backed bonds that are insured, is no matter the price of the shares of the company, the investment is based on cash flow servicing the debt and the assets. Debentures run the risk of an illiquid market. Debentures merely promise you the funds, but there is no guarantee accept the conversation into shares at best.

How they Work?

FSE Listings Inc’s team performs the typical listing services, but prior to doing so, they have qualified your firm by you contacting info@fselistings.com. The bonds are created within 20 days of listing on average, and are available to
the investor to purchase. The investors are institutions and or high net worth individuals who are sophisticated in shares and bonds, or investment in general. For the most part, sophisticated investors could contact FSE Listings Inc for access to new clients who are listing their companies and creating bonds, for the most part it is a well-known fact that in order to access corporate Bonds, you generally need to know someone within the project. In addition, with the bonded investment, the companies can offer the Bonded investment options to their current shareholders and investors.

The Risks of Corporate Bonds

Corporate bonds are risky if the company goes out of  business, but in the case of FSE Listings process, the listed company shares  and assets, as well as insurance void most of the risk of a business going out  of business. In the event the company delists and goes out of business, the assets of the company would be in priority to the Bond holder. In actual fact, being a holder of an FSE Listings based Bond is actually more preferable than a shareholder in the pecking order or to whom the assets would belong to in the even a company goes out of business. The difference is, that investors in  shares can buy nearly any value they would like, Bonds generally are 50,000 euro or higher. Government bonds pay based on the cash flow they can supply by levying taxes, corporations are on cash flow, however, Governments cannot justify high yield bonds. Businesses with cash flow and profits can generally give returns up to 10-15%. Bonds can be sold like shares, often at a discount of the interest. Since corporate bonds have more risk, they pay higher returns and often get funded faster than shares which have no guarantees and loans which require more history from the firm taking a loan. Bonds are given based on a new firm or old firm passing the cash flow qualifications.

Warren Buffett, the world’s most successful private investor, once said that a rule for private investors was to “invest in companies you really like”.

For most Britons, the names they see on the high street every day are those which inspire confidence and loyalty – from big-name retailers to, yes, even banks. Familiarity breeds not contempt but investor interest.

However, in this last recession and financial crisis, the big names lost more than most developing or  emerging market countries. The most secure investment for them is the listed bond process.

Bond markets are open to both institutional and individual investors, but there is much more participation generally by institutional investors than individual investors. European individual investors in bonds represent less than 5% of the direct investment in the European bond markets. The majority of bond market participants in Europe are institutional investors, such as pension funds, insurance companies and banks.

These are the same institutions that FSE Listings Inc traditionally would take companies on Roadshows to make private placement investments into firms, who now prefer the security of receiving a guaranteed return on investment with the shares and assets as collateral versus just shares and a CEO’s word. Thus, the listing of shares and creation of the Bond is actually more successful at financing a firm than writing a prospectus or investment memorandum and relying on a Broker or IPO. The listing and bond process is the most effective form of financing in today’s market, and the ideal security for investors to seek a return on investment.

Thus, if your SOUTH AFRICA firm is looking for financing and going public on a stock exchange such as a Frankfurt Stock Exchange listing, than you should not hesitate in contacting FSE Listings Inc. If your firm is looking for a Bond financing method, in addition, contact us today, we are the leaders in our field.

Contact info@fselistings.com

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Friday, October 7, 2011 @ 12:10 PM
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UK Frankfurt Listed Company with Bond Issuance

We have a structure which will allow your firm to list on the Frankfurt Stock Exchange utilizing a UK company, of which we then have the capacity to insure all investments going into the company in a Bond format, provided your asset and cashflow mechanisms can service the bonds or debt instruments.The structure can place from 5 million to 50 million euro depending on your companies qualifications and risk factors for the insurer. At the end of the day, your investment vehicle will be rated a double A rating giving investors guaranteed returns making it easier to raise capital for your venture.No one else can offer this to you, contact info@fselistings.com to see if you qualify today!!! http://www.fselistings.com

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