Malawi Stock Exchange (MSE) listed property giant, Mpico, says it sees a bright future following its rights issue whose listing took place in Blantyre on Monday.
The rights issue has seen Mpico raising about K9 billion from its existing shareholders and its underwriters.
Speaking on the sidelines of the listing yesterday, Mpico Board Chairperson, Edith Jiya, said the money will help Mpico settle some of its debts thereby improving its balance sheet.
“We are confident of a bright future starting next year as the squaring of the outstanding debt will be a great relief to our balance sheet.
“With the strategies put in place, we see a robust business going forward,” Jiya said.
The rights issue brings Mpico’s total number of shares in issue at 2,298,047,460 with a nominal value of K114.90 million.
“The new shares rank pari passu with all other existing ordinary shares in terms of both voting rights and dividends,” Jiya said.
Mpico shares were steady at K8 per share on the MSE yesterday.
Malawi Stock Exchange Chief Executive Officer, John Kamanga, said the rights issue was a clear demonstration that firms could raise cheap capital via the exchange.
Kamanga said Mpico was able to raise long term capital at eight percent cost which compares favourably with what the money market is offering.
Currently, the country’s commercial banks offer credit for short term at interest of about 40 percent.
Kamanga said the MSE has adopted an aggressive approach in trying to woo firms to list or make rights issues on the market.
He added that the bourse expects another rights issue from a financial institution next year.