The Ghana Oil Company Limited (GOIL), an oil marketing company, was yesterday listed on the Ghana Stock Exchange as the 32nd equity after a successful initial public offer, which saw its shares heavily oversubscribed.
The company received total applications worth 37.8 million GH cedis (378 billion cedis) but accepted 20.6 million Ghana Cedis (206 billion cedis), overshooting its target of 17.96 million Ghana Cedis (179.63 billion cedis) when it launched the initial public offer.
Government, which before the flotation was the sole shareholder, now holds 51.1 per cent and the public holds 48.9 per cent.
GOIL says it will use 50 billion cedis (five million Ghana Cedis) out of the envisaged amount to undertake modernisation and revamping of selected stations, to rehabilitate and expand identified storage depots and diversify into other related businesses, while the remainder goes to government.
The company will also build new storage tanks at Takoradi to receive new products, gas oil, gasoline and kerosene and there are also plans to enter the aviation oil market.
Speaking at the listing, Mr Kwadwo Baah-Wiredu, Minister for Finance and Economic Planning, said the wholly-owned state company was going public as part of government's strategy to reduce its involvement in the running of commercial entities.
It is also in line with government policy to divest its holdings in state enterprises through the Ghana Stock Exchange.
Mr Baah-Wiredu said government would continue to adopt proactive policies to enhance the growth of the Ghana Stock Exchange through the provision of infrastructure, tax exemption on capital gains and development of a vibrant bond market.
He said this would encourage private companies to list on the exchange to boost activity on the bourse and make real the country's goal of becoming the financial hub in the sub-region.
The Minister asked the board and management to comply with the stringent reporting conditions on the Stock Exchange to instil public confidence in the shares of the company.
Mr Yaw Agyeman-Duah, Managing Director of GOIL, said management would adopt an aggressive marketing strategy of development to tap unexplored markets.
In addition, the company will position itself in the next few years to take advantage of the crude oil revolution in the country.
Mr Kofi Yamoah, Managing Director, Ghana Stock Exchange, said it was necessary to reduce the long periods associated with public offers and listing because it was cost to issuers and did not help in staying the appetite of would-be investors. He said the excess demand was an indication of how ready the public was to participate in offerings on the stock market.
Mr Yamoah asked the management of GOIL to contribute to make the market attractive through the disclosure of all price sensitive information either good or bad to enable investors make informed decisions.
In its maiden trading GOIL gained 0.0015 GH cedis to close at 0.02150 GH Cedis up from 0.0020. GOIL was incorporated as a private limited liability company in 1960 as AGIP Ghana Company Limited. Government, however, bought back the company in 1974.