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Johannesburg - The effects of higher lending rates and the current household debt squeeze were apparent at the results of African Bank Investment Ltd's (Abil) second black economic empowerment offering.
The initial public offer to apply for discounted shares in the Masonge black ownership scheme was hugely undersubscribed in September, only raking in R58m instead of the intended R107m. A total of 9 300 applications were received.
The Masonge transaction was necessitated by Abil's acquisition of furniture retailer Ellerines early this year, which diluted Abil's initial black shareholding to below 6%. The microlender wants to achieve a black shareholding of around 15% by December 2015.
Earlier, Abil executive director Dave Woollam told Fin24.com that the Masonge scheme mainly targeted the approximately 17 000 Ellerines employees.
As part of the scheme, Ellerines employees were offered a minimum 350 shares for a nominal 35c, but this offer doesn't seem to have been taken up in large numbers either.
"As the initial offer was undersubscribed, Abil has decided to extend the offer to 28 November 2008," said Abil in a statement on Wednesday. The terms of the extended offer are the same as the initial public offer.
The R58m proceeds from the subscription were utilised to purchase 1.9m Abil shares in the open market at an average price of 2 612c/share. Masonge's sole objective is to buy and hold Abil shares until 2015.
Running at the same time as Vodacom's "hugely" successful Yebo Yethu public empowerment offer and a few weeks after Sasol's Inzalo empowerment scheme, Masonge didn't receive a lot of attention.
Yebo Yethu, which allowed black South Africans to buy shares in cellular operator Vodacom, received 100 000 applications for nearly three times the number of available shares. Sasol's Inzalo attracted applications for four times the amount it offered.
In the case of Masonge, it is mainly Abil's directors who were able to take up a large number of the shares. Three directors paid R2.6m for 900 000 shares - or 7% of the entire issue.
- Fin24.com