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analyst
Frequent Contributor
Civil engineering and building construction group, Stefanutti & Bressan ("S&B") will be one of the larger players on the JSE's `Construction and Materials' sector after listing on 3 August 2007. With 34 years of consistent profit growth, S&B holds a significant market share of the R100 billion a year construction industry.
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7 REPLIES 7
el_torro
Regular Contributor
Pre-listing placement?
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CHATTYCHAT
Super Contributor
Interesting news - also a private placement with institutions as is the fashion nowadays? Much better to get in before listing. Lotsa money on JSE to find new areas of investment.
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analyst
Frequent Contributor
With turnover of R1,7 billion forecast to rise to R2,5 billion in 2008, civil engineering and building construction group Stefanutti & Bressan ("S&B") will be positioned amongst the larger players on the JSE's main board when it lists on 3 August 2007. The group has a 34 year record of consistent profit growth since inception, with a significant market share of the R100 billion a year construction industry. S&B's expertise spans concrete structures and rehabilitation, road and earthworks, piling and geotechnical services, mine residue disposal facilities (tailings dams), opencast contract mining and building. Its spectrum of projects ranges across industrial and petrochemical plants, cooling towers for power stations, mine infrastructure, dams, roads, bridges, water and effluent treatment plants, township infrastructure and industrial, commercial and select residential buildings. The group is active throughout South Africa and has an African foothold in Angola, Botswana, Mozambique and Swaziland. Key clients include Anglo Platinum, the Cities of Johannesburg and Tshwane, Eskom, Impala Platinum, SAPPI and Sasol. Net profit to February 2007 of R67,2 million (after adjusting for the cost of BEE credentials) is forecast to swell to R115,0 million in 2008 off the increased revenue base. Headline earnings per share is anticipated to rise to 83,2 cents at February 2008 from 56,4 cents at February 2007. Chairman and co-founder Gino Stefanutti attributes the group's strength to strategic planning simultaneously over three time horizons. "To continue driving growth at S&B we, at the same time, look to optimise current business, identify opportunities for building our order book and assess options for the future, including viable acquisitions." He adds that the owner-managed structure of the group differentiates S&B from competitors. "Entrepreneurialism has taken us from humble beginnings to a well respected leader in our industry and remains a strong ethos of our current management." He says foresight has ensured that S&B has addressed retention of this management and succession planning. "Our key directors and executive management have a large stake in the company and with 85% of them aged between 35 and 55, succession planning has been factored in." Stefanutti points out that management's interest in the company will be retained after listing, reflecting their long-term commitment to the group. "The three executive directors - myself, CEO Willie Meyburgh and Financial Director Dermot Quinn - will hold an interest in S&B worth more than R580 million post-listing while executive management will collectively hold an interest of more than R250 million." CEO Willie Meyburgh believes the group's technical expertise and established reputation for delivery have positioned it to secure forecast growth. "S&B has already benefited from government's estimated R400 billion infrastructure spend." Major projects completed by the group include the Roodeplaat Waterworks project for Tshwane City Council worth R200 million, the R185 million Coega Interchange project in Port Elizabeth and civil work to the value of R200 million for Sasol. In addition S&B took share in Eskom's R84 billion committed expenditure with a R90 million contract for the upgrade of Grootvlei Power Station. Pre-listing S&B is 15% owned by black investment holding group Mowana Investments. Meyburgh says he is mindful of the need to improve black shareholding in the company to support growth. "We are positive the listing will provide S&B with an enhanced profile to attract other compatible BEE partners at group level." The capital raised on listing will boost the group's working capital to meet increasing demand and achieve S&B's target of 22% compounded organic growth year-on-year. Meyburgh adds that S&B also intends expanding its presence in KwaZulu-Natal and establishing a sustainable presence in the Western Cape. The capital raised will further fund S&B's acquisition strategy. The group intends to raise a maximum of R465 million. Up to 35 million shares will be placed privately at between R10 (on a forward price:earnings (PE) multiple to February 2008 of 12) and R12 (on a forward PE multiple of 14). These PE ratios compare to the weighted average PE of around 16 for the group's major competitors listed on the JSE main board. S&B's final placement price is set to be published after completion of a bookbuilding exercise. A limited vendor placement of up to 11,5 million shares at the final price will raise the balance of the capital. Hope this helps
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CHATTYCHAT
Super Contributor
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SimonPB
Valued Contributor
the important phrase here is Up to 35 million shares will be placed privately*. In other words, seemignly if you're not conected you won't get any pre-listing. We're investigating.
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zn
Contributor
Sorry Guys where do we look for new Listings or Placements.Many Thanks
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SimonPB
Valued Contributor
home page - under announcements. Nothing there right now.
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