It was the “Anchor effect” that helped drive the recent success of the Sygnia listing. Vunani Securities small cap analyst Anthony Clark says Sygnia is a similar business to Anchor Capital, as both provide asset management solutions to retail and institutional clients.
It was the “Anchor effect” that helped drive the recent success of the Sygnia listing. Vunani Securities small cap analyst Anthony Clark says Sygnia is a similar business to Anchor Capital, as both provide asset management solutions to retail and institutional clients.
Anchor shares were placed at 200c in September 2014, and the share now trades at R15.
And Sygnia looks like the most successful listing on the JSE since Anchor. Its shares were placed at 840c and have traded at between R13 and R17 since listing on October 14.
Sygnia CE Magda Wierzycka says the listing was more of a branding exercise than a fundraiser. “The due diligences on us are so much shorter now that we can say we are listed on the JSE,” she says. She also believes it will be easier to win mandates away from established multimanagers such as Investment Solutions and Momentum, as Sygnia will no longer be perceived as a small cottage operation.
She adds that the share price was kept conservative to ensure the success of the listing, but it was still no bargain at about 14 times earnings.
“We were told that there would be limited interest from institutions with a low free float of just R262m, but in the end 61 institutions — from asset managers to wealth managers and hedge fund managers — subscribed for shares,” she says. The private placement was 19,8 times oversubscribed.
Sygnia’s trump card is its Skeleton range of index-tracker products, which are available at a low all-in cost of 0,4%.
These products are well placed to meet the demands of national treasury, which wants all pension fund trustees to consider passive portfolios.
Clark says he is more excited about the growing retail business, which makes up 6% of assets under management but already accounts for 19% of revenues. This is supported by direct investors as well as by advisers.