GTCO to raise $105 million from LSE share offering

GTCO Holdings will sell 2.29 billion newly issued shares at a reference price of N70 per share on the London Stock Exchange. The equity offering is part of the run-up to the company’s listing on the London Stock Exchange, which is scheduled for July 9.

According to a corporate disclosure on the Nigerian Exchange website, GTCO looks to raise $105 million from the offering. After the conclusion of the equity offering, GTCO’s minimum paid-up share capital is expected to go up to about N508 billion, thus exceeding the regulatory minimum paid-up share capital. The group’s outstanding shares will hit 36.427 billion shares, and at the current share price, the market capitalization will cross the N3 trillion mark.

The pricing of the equity was done after the accelerated bookbuilding, which started on July 2 and concluded on July 3.

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In connection with the planned listing, GTCO will delist its Global Depositary Receipts (GDRs) from the London Stock Exchange (LSE)’s main market. The group will instead pursue a direct listing of all its ordinary shares on the exchange.

What is an accelerated bookbuild?

GTCO adopted an accelerated bookbuilding process for this offering, instead of a regular public offering.

An accelerated bookbuild (ABB) is a fast-track method companies use to raise funds by selling shares to institutional investors, often within 24 to 48 hours. Unlike traditional public offerings, which may take weeks, this process is quick, typically skipping the usual roadshows and lengthy marketing efforts.

In an ABB, the company reach out to a select group of investors, inviting them to bid for shares at a price determined by demand. Once the books are filled, hence the term “bookbuild”, the final price is set, and the deal is closed rapidly. In GTCO’s case, the offer was targeted at institutional investors across the US, the UK, and other select jurisdictions.

While the group initially planned to raise $100 million through the offering, investor demand exceeded expectations, with bids reaching $105 million at a reference price of N70 per share.

Between July 3 and July 31, institutional investors are expected to make capital commitments for the newly issued shares. The shares will be officially admitted to trading on both the Nigerian Exchange (NGX) and the London Stock Exchange (LSE) on July 31.

Ahead of this, the group’s Global Depositary Receipts (GDRs) will be fully delisted from the LSE on July 30. Additionally, the ticker symbol for the shares, which have been trading since July 9, will be updated from “GTHC” to “GTCO.”