ZAR X, South Africa’s first additional stock exchange in almost 60 years, has launched its operations with the listing of Senwes and it’s holding company, Senwesbel. Senwes is one of South Africa’s largest integrated agri-businesses and one of the world’s largest providers of white maize. Its 60 silo complexes allow storage of 25% of South Africa’s grain output.
‘The listing breaks new ground in several areas of the South African business landscape,’ says Etienne Nel, ZAR X CEO.
‘For more than a century, the marketers and off-takers of South African commodity production have been co-ops, whose members have been producers. Membership provided limited benefits such as secured off-take, price certainty, agricultural advice, and scale advantages.
“Things changed dramatically when government lifted grain commodities marketing restrictions. Supply and demand brought fundamental market forces into play along with soft commodities price discovery.
‘Today, agri businesses have a commercial mindset focused on value creation for all stakeholders. However, investors have been hesitant about an industry that is subject to climate change and other conditions that are difficult to control, and, therefore, cannot guarantee consistent returns.
‘That said, food security is now a global concern, with major economies such as China investing in agriculture elsewhere in the world in order to secure their nation’s food security.
‘At the same time, consumers are becoming more health and socially conscious and, therefore, extremely fussy about what they eat and where and how it is produced. Agriculture also has a major role to play economically, as most countries’ largest employer, as well as in developing and supporting local infrastructure and conserving the environment.
‘As a result, agriculture is becoming a distinctly important asset class for investors, most of whom want a return along with making a social impact. Senwes is therefore an ideal investment vehicle and we take pride in the fact that, by enabling it to list through our simplification of share trading, we are setting a precedent for South African agriculture to access growth funds that are normally available only through traditional banking finance.
ZAR X’s introduction of a principles based listing regime reduces the complexities associated with listing, making it attractive for agri businesses that would otherwise not consider listing.
For Senwes, listing on ZAR X is consistent with its own operating strategy, which is to make a meaningful contribution to food security in South Africa in a sustainable manner.
The 108-year old company focuses on input supply, financial, equipment, and precision farming services, and market access that includes grain handling, secure storage, and marketing. Its footprint covers the Northwest, Free State, Gauteng, Mpumalanga, KwaZulu-Natal, Eastern Cape, and Western Cape provinces.
‘Being the first to list on South Africa’s new stock exchange reflects our ethos of innovating to the benefit of our stakeholders and the country in general,’ says Francois Strydom, Senwes Group CEO. ‘Everything we do is aimed at providing pioneering, integrated solutions to food producers and other players in the food value chain so as to give everyone involved a competitive edge.
‘In this way, we can ensure sustainability of livelihoods, the environment, and socio-economic development in the societies in which we conduct business.
‘ZAR X’s fresh and practical approach to listing has given us a new, affordable, and very low risk avenue through which to drive our strategy and, in the process, unlock additional value for our existing shareholders. Jointly, we’re breaking new ground for agriculture in South Africa.’
Through its advanced technology, ZAR X offers real time settlement, by means of which funds and shares are received immediately after transacting. This reduces trading risk for buyers and sellers alike and promotes liquidity.