JSE aims for Africa IPO boost in 2012

Cape Town - Africa's top bourse the JSE is in "good conversation" with several companies on the continent over more potential listings next year to add to the 12 so far in 2011, says deputy CEO Nicky Newton-King.

Initial public offerings (IPOs) have tumbled, not just at the JSE but globally since the 2008 financial crisis and the subsequent eurozone sovereign debt turmoil.

"But we've got good conversations going... particularly on the continent," incoming CEO Newton-King told Reuters ahead of a briefing in parliament.

"So we expect to see more and more IPOs come, but it is a long, lengthy process just to get through the regulatory environment anyway," she said.

Besides IPOs, Newton-King said she expects to see more types of products, such as depository receipts and derivatives linked to companies being offered, instead of a traditional IPO.

She said mining, telecommunications and financial services are among the key sectors the JSE is targeting in Africa.

"Our approach is to look at issuers that need capital - need investors where their home markets might be too small. So we've got a lot of different segments we are looking at, but we are looking at particular issuers rather than trying to speak to everyone," Newton-King said.

However, the JSE, which already has 14 African companies listed, with four different debt instruments and one African exchange-traded fund, needs closer cooperation with other African exchanges as it competes with other bourses around the world.

In many instances, Africa's growing firms are shunning Johannesburg in favour of the higher-profile London Stock Exchange.

"Clearly we need to be trying to find a way to cooperate with African exchanges, with African issuers to bring more African product to the table here in South Africa, where we have a lot of international investors every day," she said.