FDH Seeks Country Listing

FIRST Discount House (FDH) capital raising initiative ahead of listing on the Malawi Stock Exchange is now on course as the institution has paid the US$1.5 million for the banking licence.

The Malawian Stock Exchange had told the discount firm it was not prudent to raise money without a banking licence.

FDH, where Kingdom Financial Holdings (KFHL) is the the largest shareholder with 40.16 percent, want to embark on an Initial Public Offering (IPO) to raise US$1.8 million to set up a merchant bank.

Thomson Mpinganjira, FDH chief executive officer told Standardbusiness last week the three shareholders of the discount house had paid for the licence but were waiting for approval from the regulatory authority.

"In so far as the capital for the bank, all three shareholders, KFHL, Old Mutual, and The Thomson Frank Mpinganjira Trust have paid their up their portion for the licence as of August 16, 2007 and await further communication from the Reserve Bank of Malawi," Mpinganjira said.

He said FDH had as of 23 August 2007 FDH satisfied all conditions stipulated by the Malawian Stock Exchange for listing of its shares and now awaits its decision.

FDH has three shareholders: KFHL (40.16%), Thomson Frank Mpinganjira Trust (39.84%) and Old Mutual (20%).

The listing on the bourse will reduce the shareholders' equity in the company to 28.11%; 27.89% and 14% for KFHL, TF Mpinganjira Trust and Old Mutual respectively with 30% taken up by the public.

At its 12 June board meeting FDH directors gave the nod for the discount house to list on the MSE.

The IPO would have run from 9 July to 3 August with listing slated for 13 August "all things being equal".

"We could have listed it at the end of July," said Nigel Chanakira FDH chairman, "but it was unfortunate that the MSE said it was not prudent to raise money before getting a banking licence."

FDH started operations in 2002 and controls over 50% of the market share ahead of its nine-year-old competitor, Continental Discount House..

It also has a stockbroking firm, FDH Stockbrokers and in April announced that it had mutually agreed to stop negotiations with Nedbank Malawi, which would have led to FDH taking over Nedbank.