Financial services group, Efficient Financial Holdings, lists on JSE Main Board
Efficient Financial Holdings Limited (EFH) (JSE Code: “EFF”) listed on the Johannesburg Stock Exchange today on the Asset Managers section of the Main Board. A diversified financial services provider, EFH offers asset management, fund administration, research and marketing services to institutional and individual investors, as well as other financial services.
Heiko Weidhase, EFH Managing Director, says the listing of the group will provide it with the ability and currency to expand its operations and take advantage of the significant opportunities that are presently available within the current economic and financial climate. “The listing will also raise our profile locally and internationally, enhance client and public confidence in our business because of listing requirements that improve transparency and good governance, and allow us to attract top talent through offering equity participation.”
Noah Greenhill, head of Marketing and Business Development at the JSE comments: “Some may consider it counterintuitive to list at the current time, but we believe that EFH is listing for the right reasons and a listing can add substantially to their business. They have raised over R38.7 million in their private placement which negates the sentiment that it’s not possible to raise capital in the current market. We are pleased to welcome them onto the Main Board.”
EFH’s asset management division has approximately R3.2 billion of assets under management and its senior portfolio managers include Brett Bishop, Harold Hopking and Charles Snyman. Its fund administration business has approximately R1.3 billion under fund administration. The financial services business offers financial planning, cash flow management and employee benefits advice, currently to clients of PKF (Cape Town) Inc and other individuals.
The retail line of the group focuses on providing asset management and financial planning solutions to individual investors, primarily through focusing on independent financial advisers. This includes support services via a portal and reporting assistance on behalf of its associated independent financial advisers. The client base includes 100 independent financial advisers and approximately 9 000 mandated clients.
Economic research for the group is conducted by senior economist and EFH executive chairman, Dawie Roodt, supported by a research team.
The group’s institutional business focuses on marketing its funds to "White Label" managers, multi-managers and fund of fund managers. Going forward the group will also compete in the segregated mandate management space and tender for pension fund management business.
The asset management and financial services divisions of the group are Cape Town based, and its head office, marketing, economic research and administration operations are located in Pretoria.
Weidhase says that future prospects of the EFH Group are extremely positive. “We see several opportunities for growth. These include expanding the group’s retail marketing channel, offering a greater variety of products to retail clients, and more comprehensively developing our institutional marketing channel. We are also considering acquisitive opportunities of niche boutique managers. We aim to extend the group’s financial services offering through partnering, as we currently do with PKF (Cape Town) Inc, with professional advisory firms such as lawyers and accountants and other regional branches of PKF.”
EFH was incorporated on 27 November 2006 to hold the interests of the Efficient Group and FHS Financial Services (Cape Town). FHS Financial Services (Cape Town) holds 100% of both Multigro, a fund of funds manager, and Valugro, an award winning Unit Trust Fund Manager. These holdings were effective 2 October 2007 and the EFH group now conducts its operations through these two wholly-owned operating subsidiaries.
Operationally EFH’s business units are divided into separate business units with financial services offered through FHS Financial Services (CT), the funds of funds business units being Multigro and Efficient Group and the unit trust business unit, Valugro. Chinese walls are maintained especially between the unit trust division and funds of funds division. Efficient Collective Investments houses asset administration whilst employee benefit products are distributed via FH Employee Benefits.
EFH also has a 25% minority interest in Thebe Securities, a member of the JSE and the Bond Exchange of South Africa.
The result of the private placement:
-7 742 700 ordinary shares were placed with select investors at R5 per share as follows:
- 4 262 700 issued ordinary shares were sold by shareholders for an aggregate amount of R21 313 500
- 3 480 000 new ordinary shares have been allotted and issued for cash by the company for an aggregate amount of R17 400 000.
- 71 200 ordinary shares have been placed with independent financial advisors at R4 per share which ordinary shares were allotted and issued for cash by the company for an aggregate amount of R284 400.
39 641 323 ordinary shares will be listed on the Main Board of the JSE.
These pre-listing transactions were not subject to a minimum subscription being achieved and have been partially underwritten.
Funds raised from the transactions precedent to listing will be used to expand the business of the group in a variety of ways by developing the financial services component of the business through cross selling various products to the group’s loyal private client base; increasing its institutional investor activity by improving its profile through increased marketing drives; providing the group with ready capital, in whole or in part, to expand the business through appropriate acquisitions and/or joint venture initiatives as and when these opportunities arise; discharging the expenses of the listing; and providing a partial exit to certain of the existing shareholders.
