Realising that attracting and retaining the best technology talent can be facilitated by providing employees with an opportunity to share in the future growth of the organisation, Intervid Limited (Intervid) has announced its intention to list on the Development Capital market of the Johannesburg Stock Exchange. The company aims to privately place 8,5 million ordinary shares at an issue price of 100c each which will result in the issued share capital of Intervid comprising 87 500 000 ordinary issued shares.
CEO Rob Howard advised that the private placement offer to selected institutions opened 4 August and closed on Thursday 12 August. Listing commenced on Wednesday 18 August. He is confident that the offer will be successful saying "BOE, through the investment arm of its corporate division, has already committed to a stake in the company which will amount to 9,1% on listing which is extremely pleasing." The R8,5 million to be raised through the share placement will be used to fund working capital requirements and to provide capital for future acquisition and expansion opportunities.
Origins of Intervid
The origins of Intervid date back to 1989 when the company, then known as Industrial Park Security Specialists (IPSS), was formed to supply technology-driven security solutions to the niche market of decentralised industrial estates. While the industrial sector focus of the company has remained unchanged, a repositioning of its activities, aimed at riding the wave of the digital technology revolution, has resulted in a portfolio of services embracing consulting and the design, installation, servicing and rental of digital automated management systems. These activities have been driven via a separate division, Video Management Systems (VMS). The consulting aspect is critical in that it is here that VMS works with customers in order to identify production risks, productivity failures/weaknesses, security risks and management weaknesses with a view to providing appropriate solutions using digital visual management systems.
Through CCTV Technologies, a 51% held company (with the balance of the shares held by previously disadvantaged individuals), Intervid targets the supply and installation of systems for airports, local municipalities, prisons and other government departments, parastatals and public service utilities.
Financing security solutions
An important aspect of Intervid's business is that it has a wholly owned finance brokerage which ultimately provides financing solutions to clients through a comprehensive rental package. This provides Intervid with a unique selling point and advantage over its competitors.
Broad client base
The Intervid group has an active client base in a cross-section of markets including manufacturing and production; mining; airports, universities and technikons; municipalities; forestry and timber; security; and marine and harbours. The Durban-based company has offices in major centres across South Africa, with full sales and service divisions.
Howard advises that Intervid has amassed significant intellectual wealth and industry experience in the company and has an established reputation for delivering turnkey solutions which address both the security and productivity functions of an industrial or commercial enterprise. "Intervid offers a broad range of digital automated management systems which can be customised and fully integrated to satisfy the end-product functionality requirements of any application," he says. "There is also tremendous potential for the export of our unique products. Indeed, ongoing research and development is certain to lead to further niche systems for existing and new markets, both locally and internationally."
In keeping with the company's people-orientation, the listing intentions include the concurrent establishment of a share incentive scheme for employees. The listing of Intervid will also serve to position and capitalise the company so that it can sustain the growth already experienced; enhance investor and general public awareness; and facilitate future capital raising to fund growth (whether organic or by acquisition).
Board chairman Bill Lambert is confident that Intervid's growth prospects are unlimited. "The niche positioning of Intervid places the company in a strong position to maximise participation in its chosen sector of the digital revolution," he says. "The opportunities for expansion and growth in this largely untapped market are limitless, both throughout South Africa and across the globe. Listing the company provides an excellent forum from which to achieve Intervid's potential."
His confidence is reflected in the financial forecasts published in Intervid's listing prospectus. Turnover for the year ending 28 February 2000 is projected at R67 million (1999: R15,8 million) with earnings per share of 15,0c (1999 pro forma 1,4c) - equating to a forward PE of 6,7 times at the proposed issue price. In this regard, Howard notes that contracts representing approximately 90% of the projected years turnover have already been secured.
For details contact Intervid's Rob Howard or Rob Le Sueur on telephone (031) 764 1136 or fax (031) 764 2558.
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