UT Financial Services Goes Public

UT Financial Services Ltd (UTFSL), a home-grown non-bank financial services company, has launched a share offer to raise GH¢27 million to shore up capital and roll out more branches.

The company will from September 22, to October 17, seek to cede 42.85 per cent of its ownership to the public through an initial public offer (IPO) of 90,293,000 shares at 30Gp per share.

The company, currently owned by two private individuals, says only GH¢3 million of the funds will deepen the capital base of the company to enable it to do more business.

The rest of the funds would go into supporting affiliate companies such as UT Collections Ltd, UT Properties Ltd and UT Logistics, whose growth, it is believed, would impact directly on the operations and profitability of the financial services provider.

The Chief Executive Officer of company, Capt Prince Kofi Amoabeng (retd), said the company was already profitable and the public offer was only to give the ordinary Ghanaian who had been the core customers, the chance to own part of the company.

When listed, UT would become the 19th most capitalised company out of the 36 equities quoted on the Ghana Stock Exchange and will be the first to join the exchange on its automated trading platform which will complete in about a month's time.

Capt Amoabeng said the company operated within a very transparent and efficient accounting principles and governance structure and that apart from its own auditors, which audited its books twice in a year, regulators and tax agencies also checked the books regularly.

The Director of Finance and Administration, Mrs Pearl Esua-Mensah, giving the financial position of the company, said for a projected profit before tax (PBT) of GH¢7.4 million for the year, the company had already recorded GH¢3.4 million half year through the year.

The half year loan book of UTFS stands at GH¢64 million out of a projected GH¢78 million for the year.

Mrs Esua-Mensah said the company expected its net revenues to grow by 32 per cent at the end of this year and about 20 per cent in 2010, when the company would have enlarged, against stiffer competition, which she stated "we welcome and are positioned to compete."

According to her, the company's profit before tax which was GH¢1 million in 2004, had grown consistently, reaching GH¢6.1 million last year with end of year profit projected to reach GH7.4 million

The Chief Executive Officer of the lead managers, Databank, Mr Ken Ofori Atta, said the spirit of entrepreneurship, hard work and excellence demonstrated by UTFSL was ample testimony of a company with a brighter future.

"I urge all investors to participate in this because I see a lot of expansion in UTFSL in a few years," he said.

The Director of Operations, Capt Budu Koomson, said having opened nine branches already, it was now time for UTFSL to spread further to other parts of the country, saying nine more would be opened shortly.

The company has just set feet in the larger Nigerian market and, according to management; it was one of the most promising areas of the company's operations.

About four million shares, representing 4.43 per cent of the shares on offer have been allotted to the 300 staff of the company under the Employee Share Option.

Other applicants can purchase a minimum of 500 shares (or GH¢150) and thereafter in multiples of 100 shares.

The Presiding Bishop of the Methodist Church, the Most Rev Robert Aboagye-Mensah, who launched the IPO, called on the public to invest in the company for higher returns.

He said the company had also helped to inculcate a very profound psyche in the Ghanaian that "if you take a loan, you must pay back."

Story by Samuel Doe Ablordeppey