Trustco needs N$2.4 billion to tap into Namibia’s economic potential

Martin Endjala

Trustco Group Holdings Limited is set to raise N$2.4 billion from shareholders to tap into Namibia’s economic potential.

This pivotal transaction with key shareholders is said to underscore confidence in Namibia’s bright economic prospects and Trustco’s time-tested capabilities to channel investment into high-growth areas.

Trustco and United States fund Riskowitz Value Fund LP (RVF) will enter into an option to make a cash investment of up to N$950 million into Trustco, entrenching RVF as a key anchor foreign investor.

The capital will provide Trustco with the unparalleled financial muscle to capitalise on new opportunities and strengthen existing investments in a Namibian economy that is poised for rapid growth.

Additionally, Next Capital (Pty) Ltd and entities affiliated with Trustco’s founder, Quinton van Rooyen, made an offer to convert debt in the amount of N$1.48 billion into new ordinary shares in Trustco.

Van Rooyen said this transformation of debt into equity is a proactive approach to debt management that unlocks free cash flows for future investment, frees up capital for dividends in the medium term, and more than doubles Trustco’s net asset value.

Furthermore, he said the conversion option will optimise Trustco’s capital structure and align the interests of founder shareholders with minority holders and key debtholders.

“With our country’s wealth of natural resources, stable governance and strategic location, Namibia’s economic future is filled with promise,” said Van Rooyen.

He added that these shareholder actions allow Trustco to convert national potential into investment opportunities, and shareholder returns, and reinforce its progressive trajectory and diversification strategy.

These moves he said, emphasise the Group’s dedication to creating sustainable value for its shareholders and solidifying its position in the market. Additionally, they will channel this investment into innovations that empower more investors to secure their financial futures and reward shareholders and Namibians in general.

“These transactions represent an opportunity to align our interests and leverage Trustco’s expansion. They signify shareholder confidence in Trustco’s vision, high-value assets and potential for sustained growth across its diverse investment portfolio.

RVF is committed to supporting dynamic enterprises in emerging markets and leveraging opportunities that drive mutual success,” said RVF’s Founder Sean Riskowitz.

While emphasising that the transactions emphasise the vibrancy of the Namibian investment landscape Trustco stands energized to deliver sustained value creation to its loyal shareholders by channelling capital into areas that will reshape the national economic landscape for the future.

He said these actions translate into direct value for investors. The capital injection fortifies Trustco’s balance sheet and enables expansion that will drive portfolio growth, share buybacks and dividends over time. Meanwhile, Trustco is in the process of concluding the acquisition of an additional 11.35 percent stake in Legal Shield Holdings Ltd to expand its investments in Namibia’s insurance and real estate sectors.

Trustco currently holds 80 percent of this entity and will increase its stake to 91.35 percent. The transaction provides Trustco greater exposure to the strong growth potential in these key industries as Namibia’s economy expands and increases Trustco’s net asset value.

For the past 31 years, Trustco has invested in a diversified portfolio uniquely positioned to benefit from Namibia’s rise across multiple industries.

The new capital and investments expand capacity to enable Trustco to accelerate value creation and move more quickly toward paying dividends and engaging in value-creating share buybacks. The Board hence views these actions as solidifying Trustco’s investment platform for the future.

Historically, Trustco’s investment portfolio has delivered exceptional returns, with a well-balanced asset mix, which has maintained an average weighting of 34 percent in US Dollar based assets, while the remaining 66 percent is invested in Namibian Dollar based assets.

Trustco enjoys the backing of a wide range of co-investors, including 3 610 from Namibia, 1 443 from abroad, and 94 from institutional entities.

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