The JSE's first professional services firm, SAB&T Ubuntu, listed this morning on the Alternative Exchange (AltX).
The company, which offers IT services, is the junior bourse's 36th company. AltX now has a market capitalisation of close on R7 billion, says Noah Greenhill, marketing and business development GM at the JSE.
JSE chairman Humphrey Borkum says he is "very excited" by the listing. SAB&T Ubuntu chairman Jeff van Rooyen says the firm, started 12 years ago by a group of black professionals, is listing at an appropriate time.
The professional services market, he says, is a multibillion-rand sector with scope to grow as the economy moves towards a 6% growth target by 2010. Add to this government's proposed capital expenditure of R370 billion and the company has scope to grow.
Van Rooyen notes the company's turnover targets - of R60 million next year and R70 million the next - are conservative. "I think we can do a lot more than that." The company expects to report a R9.8 million profit before tax in February 2007.
The company, which offers corporate governance and internal audit services, forensic services, entrepreneurial business service, IT service, management consulting services, personnel and recruitment services, aims to expand geographically off the back of the listing.
Slow start
Trading under the code SUL, the company has 282.3 million shares listed, but did not see any trade shortly after the market opened. Its private placement was at 30c a share and it later saw an opening price of R1.20, giving it a market capitalisation of R338.76 million on listing. Bashier Adam, CEO and founder said the company was "pleasantly surprised at the opening price of R1,20 but we don't expect this to be sustained".
Adam says one of the key reasons for an AltX listing is staff attraction and retention. "Over 75% of our employees are from previously-disadvantaged groups. In the highly competitive area in which we operate, we firmly believe the acquisition and retention of talented people is the key to our future sustainability."
Herman van der Merwe, who heads up the company's IT division, says it differentiates itself from other professional services companies by offering IT services that seek to align IT with business imperatives.
SAB&T offers complete IT assurance services as an integral part of its other professional services offerings, explains Van der Merwe. He adds that many local companies lack an IT strategy and this is where the company can offer a complete reengineering of the division.
The IT division also offers Internet service provision through SA Gateway Internet Services, which aims to be a low-cost ISP.
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