Local company sells shares

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MASERU — Morou Development Limited, the company that owns Pioneer Shopping Mall, is selling shares to the public. According to the prospectus the public offer opened on December 1 but company officials say the shares only started trading yesterday. There are 175 000 shares on offer at M600 each. Morou wants to raise M105 million which will be used to construct phase two of the mall. The offer will close on January 20 next year and the shares are being sold at Pioneer Mall. Morou is the first local property company to offer shares to the public. Phase I of the mall was opened in November 2009 with 14 500 lettable square metres. It is currently 100 percent let with a tenant list that includes Edgars, Nedbank, Standard Bank, Pick n Pay, Life’s Comfort Solutions, Foschini and Markham. Phase II, which is expected to be completed in November 2012, will have 5 725 lettable square metres. So far 77 percent of the space has already been booked by Mr Price, Markham, Total Sports, Exact, Sterns, Fashion Express, FNB, Identity, Clicks and Truworths. Once Phase II is completed the mall will have 20 225 square metres in rentable space. For the year-ended March 31, 2011 Morou had M10 954 126 net profit before interest and tax. Company directors however project that from November next year when Phase II is completed that figure will jump to M21 340 394. The whole property will be worth M284 538 588. Rentals are forecasted to escalate by between eight and 10 percent per year. The value of the mall itself will escalate by about 7.5 percent, according to projections. The shares will be tradable on the open market. That means even after the public offer is closed you can still buy the shares from other investors. Danny Bothma, one of the directors, said they are looking for people who are interested in a long term investment opportunity. He said the motive behind the public offer is to raise capital and give people a chance to invest in property. “This is an investment that offers better return,” Bothma said yesterday. He said so far the uptake of the shares has been encouraging. “We had not advertised or aggressively marketed the public offer but the response has been good.” He said this was an opportunity for people to invest in property. Lesotho’s property market has been experiencing a boom for the past three years. Investors are putting their money into commercial property.

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