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Trustco has high hopes for Herboth’s Blick, expects new development to contribute almost 70% of total value of all its property holdings

Trustco has high hopes for Herboth’s Blick, expects new development to contribute almost 70% of total value of all its property holdings

Trustco announced last week that it has obtained approval from the Ministry of Urban and Rural Development for the further development of the peri-urban estate, Herboth’s Blick. Despite the seemingly good news, the diversified insurance, investment, real estate and mining group’s share price on the Johannesburg Securities Exchange remained sticky, in fact falling by another 5% after the announcement.

Since the beginning of 2019, Trustco shares have taken back around 55% of their value, following the spectacular 100% appreciation in the fourth quarter of 2018. On Thursday 12 September, the share shed another almost 10% bringing it down to N$6.25, a level it has last seen in October 2018.

Following a spat between Trustco and investors earlier this year over adjustments to the so-called fair value of its properties, most notably the extensive tracts of undeveloped land it owns, Trustco was hoping that the announcement of another major project in its property development portfolio, will boost the lagging share.

Regarding the further development of Herboth’s Blick and its impact on the group’s balance sheet, Trustco stated in a SENS announcement “To unlock the future potential in land value, an application for the permission of the need and desirability to establish the new township was submitted to the [ministry] during the reporting period. It is estimated that the increase in fair value, once the new approval has been obtained would be significant.”

The application for township development was submitted to the ministry just over a year ago, and last week, 02 September, it was approved in principle.

“The provisional approval is subject to certain documentation to be compiled and a meeting to be held between the representative of the Issuer and the Local Authority within a 60 day period,” according to the SENS.

Citing comparable land values, Trustco said once developed, it will increase the value of the land from the current carrying value of N$30 per square metre to between N$1650 and N$2200 per square metre, depending on whether it is residential or commercial land. This will have an enormous impact on the value of the entire project.

“Upon final approval by the Minister for the Need and Desirability for Township establishment on the Herboth’s Blick development, a re-valuation of the property will be attended to as such approval will have a significant effect on the fair value of the property investments of the Issuer. This long term development comprises 68% of the total property land bank portfolio,” stated Trustco.


 

About The Author

Daniel Steinmann

Brief CV of Daniel Steinmann. Born 24 February 1961, Johannesburg. Educated at the University of Pretoria: BA, BA(hons), BD. Postgraduate degrees are in Philosophy and Divinity. Editor of the Namibia Economist since 1991. Daniel Steinmann has steered the Economist as editor for the past 29 years. The Economist started as a monthly free-sheet, then moved to a weekly paper edition (1996 to 2016), and on 01 December 2016 to a daily digital newspaper at www.economist.com.na. It is the first Namibian newspaper to go fully digital. Daniel Steinmann is an authority on macro-economics having established a sound record of budget analysis, strategic planning and assessing the impact of policy formulation. For eight years, he hosted a weekly talk-show on NBC Radio, explaining complex economic concepts to a lay audience in a relaxed, conversational manner. He was a founding member of the Editors' Forum of Namibia. Over the years, he has mentored hundreds of journalism students as interns and as young professional jourlists. He regularly helps economics students, both graduate and post-graduate, to prepare for examinations and moderator reviews. He is the Namibian respondent for the World Economic Survey conducted every quarter for the Ifo Center for Business Cycle Analysis and Surveys at the University of Munich in Germany. He is frequently consulted by NGOs and international analysts on local economic trends and developments. Send comments to daniel@economist.com.na

Following reverse listing, public can now acquire shareholding in Paratus Namibia

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20 February 2020, Windhoek, Namibia: Paratus Namibia Holdings (PNH) was founded as Nimbus Infrastructure Limited (“Nimbus”), Namibia’s first Capital Pool Company listed on the Namibian Stock Exchange (“NSX”).

Although targeting an initial capital raising of N$300 million, Nimbus nonetheless managed to secure funding to the value of N$98 million through its CPC listing. With a mandate to invest in ICT infrastructure in sub-Sahara Africa, it concluded management agreements with financial partner Cirrus and technology partner, Paratus Telecommunications (Pty) Ltd (“Paratus Namibia”).

Paratus Namibia Managing Director, Andrew Hall

Its first investment was placed in Paratus Namibia, a fully licensed communications operator in Namibia under regulation of the Communications Regulatory Authority of Namibia (CRAN). Nimbus has since been able to increase its capital asset base to close to N$500 million over the past two years.

In order to streamline further investment and to avoid duplicating potential ICT projects in the market between Nimbus and Paratus Namibia, it was decided to consolidate the operations.

Publishing various circulars to shareholders, Nimbus took up a 100% shareholding stake in Paratus Namibia in 2019 and proceeded to apply to have its name changed to Paratus Namibia Holdings with a consolidated board structure to ensure streamlined operations between the capital holdings and the operational arm of the business.

This transaction was approved by the Competitions Commission as well as CRAN, following all the relevant regulatory approvals as well as the necessary requirements in terms of corporate governance structures.

Paratus Namibia has evolved as a fully comprehensive communications operator in Namibia and operates as the head office of the Paratus Group in Africa. Paratus has established a pan-African footprint with operations in six African countries, being: Angola, Botswana, Mozambique, Namibia, South Africa and Zambia.

The group has achieved many successes over the years of which more recently includes the building of the Trans-Kalahari Fibre (TKF) project, which connects from the West Africa Cable System (WACS) eastward through Namibia to Botswana and onward to Johannesburg. The TKF also extends northward through Zambia to connect to Dar es Salaam in Tanzania, which made Paratus the first operator to connect the west and east coast of Africa under one Autonomous System Number (ASN).

This means that Paratus is now “exporting” internet capacity to landlocked countries such as Zambia, Botswana, the DRC with more countries to be targeted, and through its extensive African network, Paratus is well-positioned to expand the network even further into emerging ICT territories.

PNH as a fully-listed entity on the NSX, is therefore now the 100% shareholder of Paratus Namibia thereby becoming a public company. PNH is ready to invest in the future of the ICT environment in Namibia. The public is therefore invited and welcome to acquire shares in Paratus Namibia Holdings by speaking to a local stockbroker registered with the NSX. The future is bright, and the opportunities are endless.