InvestorRelations.co.za, the Independent newspaper group`s answer to the change in stock exchange rules that could divert advertising from its print publications, plans to be operational by the end of the month with its first clients.
With advertising coverage from Independent newspapers, including The Star and the Cape Argus, and a link from the Independent Online (IOL) site, it expects to capture the market quickly.
"We expect to have 33% of listed companies as clients by this time next year," says Brendan Pather, MD of InvestorRelations.
The company is 75% owned by Independent Online and is seen as the Independent`s play to minimise its losses when companies are no longer forced to publish corporate notices in print publications, notably Independent`s Business Report.
In October 2002, JSE rules will no longer require companies to communicate with shareholders through newspapers, and InvestorRelations wants to be the alternative channel.
Pather says the company does not intend to compete with the JSE`s own electronic Stock Exchange News Service (SENS). "We haven`t had any response from the JSE as yet, but I don`t believe SENS is set up to provide the all-round service that we can," he says.
The company was launched earlier this year as an offshoot of the Corporate Communications Broadcast Network (CCBN), an American investor relations provider. It maintains strong links with CCBN, but Pather says the Independent investment gave it a jump-start. "Without IOL, we would have had to offer a subscription service, instead of giving the information free to the reader. That will help a lot in building a reader base."
The basic service on offer is priced at R18 000 a year, giving InvestorRelations a potential market of R12 million, of which it wants to capture 80% by the end of 2002, about the same time it wants to break even.
"We want the transition from print [notices] to online to be an orderly progression as the regulations relax, and I think that is why IOL saw value in us," says Pather. He also sees value in driving specific traffic, from the investor community, to corporate clients` Web sites.
An advertising campaign for the service will kick off at the end of October.
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