BCFC rights issue to boost growth
Manama, October 8, 2008
Bahrain Commercial Facilities Company (BCFC) opened its rights issue to raise BD25 million ($66.3 million) to fund its future growth strategy today (October 8).
The cash will be used to finance growth in the core businesses of Bahrain Credit, National Motor Company, Tas'heelat Insurance Services Company and Tas'heelat Real Estate Services Company.
Shareholders registered on BCFC's register on September 29 are entitled to subscribe for a total of 42,350,000 newly issued ordinary shares at an offer price of BD0.600 each.
Shareholders have the right to purchase 35 ordinary share for every 100 shares held on the record date. The offer period will run from today to October 22.
"BCFC is a company that has been built on anticipating the changing needs of the various markets we operate in," said BCFC chairman Abdulrahman Yusuf Fakhro.
"As our economy rapidly develops, this is creating new requirements from our customers, especially in the credit and consumer facilities, insurance and real estate markets.
"Despite the current global market downturn, we believe Bahrain and the region continue to be set for a period of sustained growth, as investments continue to be made into the region's infrastructural needs, which will help to underpin and drive the region's economies.
"This will see an increasing need for financing for a range of different needs. By raising capital now, we will be able to invest in product development across all of our consumer credit, insurance and real estate businesses, to ensure that we stay ahead of our customers' needs and continue to win market share as we increasingly become the financing provider of choice," he said.
"The offer price represents a good opportunity for our shareholders to buy into the future success of our strategy, a strategy which has delivered consistent value, with a 24 per cent return on equity, 84 fils of earnings per share and a 40pc dividend ratio in 2007," he added.
"The proceeds from the rights issue will enable us to strengthen our consumer finance business with additional funding and by reducing leverage to improve net earnings," added senior vice-president and head of consumer finance Adel Hubail.
"We will also invest in creating additional capacity for our growing automotive business, National Motor Company.
"In addition, we will invest in new products and business lines across our entire operations, ensuring that we remain ahead of our competition by delivering what our customers need," he added. - TradeArabia News Service