First Agra shares trade on NSX
Mysterious buyer mops up batches
The first batch of Agra shares changed hands this week Tuesday following the recent conversion of the former corporation to a limited company.
In a historic move for the country’s equity market, 110 821 Agra shares changed hands at a price of N$1.70 per share through a deal sponsored by pointBreak under the Namibia Stock Exchange’s newly-introduced Over The Counter (OTC) Market.
The deal, worth just under N$200,000, is the first opportunity for price discovery for Agra’s shares. Following the trade on Tuesday, a buyer also mopped up 131 000 new shares at a price of N$1.68 per share followed by another trade the same day in which 20,000 shares changed hands at a price of N$1.60 per share. An unknown bidder listed a bid for an unspecified number of shares at a share price of N$1.38.
It was not immediately clear who had disposed off or bought the Agra shares, although speculation was rife that Stimulus, a private equity fund, had moved in to acquire a stake in the profitable agri-business, because of the fund’s relationship with the sponsoring broker, pointBreak. The latter controls Stimulus, and although it is a registered stockbroker, the firm had not been involved in equity sponsoring for several years before the conversion of Agra.
However, Gerald Riedel, a director of pointBreak who was personally involved in the deal, and Stimulus’ Monica Kalondo, denied any suggestions that Stimulus had bought the shares.
Riedel told the Economist upon enquiry that while he could not divulge details of the buyer as this was a private transaction, he was certain that Stimulus had not bought the Agra shares. He said that such transactions are normally for individuals.
Kalondo also denied any involvement in Agra, telling the Economist: “Stimulus has not bought any shares in Agra nor do we intend to.”
Riedel explained that pointBreak’s involvelment in brokering Agra’s shares was because the firm had acted as a corporate advisor in the conversion of Agra.
Agra has issued around 102 million shares to former co-op members as part of the conversion to a limited company. Agra is precluded from listing on the NSX by one critical condition stipulated in its Articles of Association: – no Agra shareholder is allowed more than 5% voting right regardless of the number of shares held. This constitutes more than 5 million shares which will take about 6 months for any large investor to acquire at the transaction rate of this week.