12% Shares in PBC For Sale

A strategic investor is being sought to pick up a 12.24 percent stake in the country�s biggest licenced cocoa buying firm, Produce Buying Company (PBC), a top official has revealed.

�We�re looking for a strategic investor to take up the shares to finance PBC�s expansion projects,� added the official, who pleaded for anonymity. �In May 2000, during our flotation of 384 million shares to the general public, the 12.24 percent were held for institutional investors but couldn�t get a buyer. In view of that, the shares were registered as NTHC/Institutional Investor Consortium,� the source explained.

�Now we have asked our registrar, NTHC, to release the shares for the general public. We�re confident that a strategic investor out there will buy the shares,� said the source.

Out of the top-20 largest shareholders in PBC, the Social Security & National Insurance Trust (SSNIT) holds 38.10 percent while Government and NTHC/Institutional Investor Consortium holds 36.69 percent and 12.24 percent respectively.

The top-three shareholders in PBC together hold 417million shares, representing 87 percent of the issued shares of the company. �It�s welcome news, but it depends on who is buying it,� said Enyonam Dagadu, Head Brokerage, African Alliance Securities Ghana.

PBC�s stock has shown strong demand on the Ghana Stock Exchange due to the impressive financial performance it has posted in recent times, especially its performance last year.

The company registered a net profit after tax of GH�14.112million in the financial year ended September 2010, 171 percent higher than the 2009 figure of GH�5.194million.

It recorded a profit before tax of GH�19.256million as against the GH�7.176million of the previous year, and achieved an unprecedented high market share of 38 percent as against 35 percent in previous year.

Turnover for cocoa increased from GH�430.528million to GH�622.664million - an increase of 44.6 percent due to increase in producer price.

With a reduction of 11 percent in national cocoa purchases - from 710,639 tonnes in 2008/2009 to 632,026 tonnes in 2009/10, due mainly to cocoa-smuggling activities - the company�s purchases reduced by a smaller margin of 4 percent from 247,881 tonnes to 238,967 tonnes.

At the close of last week on the GSE, PBC traded a total of 17,500 shares valued at GH�3,850 compared to 34,867 share valued at GH�7,695 in the same period last week. The share price was unchanged at GH�0.22. PBC evolved from the produce department of the Ghana Cocoa Marketing Board. It was incorporated as Produce Buying Division in November 13, 1981 as a 100 percent state-owned enterprise.

By a special resolution of its Board of Directors, the name was changed to Produce Buying Company Limited in October 27, 1983. By the shareholders agreement dated September 15, 1999, pursuant to the divestiture objectives of the government, the PBC shareholding was transferred from the Ghana Cocoa Board to the Ministry of Finance on behalf of the government. The company was eventually listed on the GSE on May 19, 2000.

Source: B&FT