Transaction Capital successfully concludes R1.28bn equity raise

JSE-listed mobility and digital services group Transaction Capital has raised R1.28 billion through an accelerated bookbuild it launched on Thursday, exceeding the group’s target of R1 billion following strong demand from the markets.

The group opened the accelerated bookbuild process on Thursday. Capital raised will be used to pursue different growth opportunities for the group, one of which may include increasing Transaction Capital’s shareholding in WeBuyCars.

Capital may also go towards funding the establishment and growth of SA Taxi’s new GoMo business and towards enhancing the group’s liquidity.

The oversubscribed bookbuild ended with the issuing of 36 055 520 placing shares which represent 5% of Transaction Capital’s issued ordinary share capital prior to the placing.

Shares were issued at R35.50 per share, a 3.9%  discount to the pre-launch close price of R36.95 and a 7.5% discount on the 30-day volume weighted average price of R38.36, as of market close on Thursday.

“The placing shares, when issued, will be credited as fully paid and will rank pari passu in all respects with the existing ordinary shares in the share capital of the company, including the right to receive all dividends and other distributions declared, made or paid after the date of issue of the placing shares,” the group said in a statement.

The group says it will submit an application to the JSE to have the placing shares listed, if approved the shares are expected to be listed at market open on Wednesday 14 September.

“Following admission, the company’s issued share capital will comprise 757,367,333 ordinary no par value shares.”

“This figure may be used by shareholders in the company as the denominator for the calculations by which they will determine if they are required to notify their beneficial interest in, or a change to their beneficial interest in, the company’s ordinary shares under section 122 of the South African Companies Act of 2008,” the group adds.

Transaction Capital’s share price dropped as much as 3% to R36.20 in early morning trade, slightly recovering to R36.31 soon after, as the market reacted to the latest news from the group on Friday.

WeBuyCars’ growth prospects

WeBuyCars, an online secondhand car valuation and  selling platform, is now generating almost half of the group’s headline earnings and according to Transactional Capital, continues to outperform expectations for key performance metrics, the group said in an operational update.

“We expect future earnings from WeBuyCars to continue to grow at high rates over the medium-term, given its strategic positioning as a provider of innovative mobility products in a favourable market,” the group said.

Ambitions for the business now lie in growing its e-commerce offering and expanding its geographical presence.