Total Client Services Limited (TCS) provider of technology, proprietary application software, and specialised services to Local and Provincial Government authorities, is to list on the JSE’s Alternative Exchange by way of private placement, on Monday, 7 April 2008.
The JSE has formally approved the listing of 426 122 223 shares. 42 553 192 shares will be issued by the company and another 42 553 192 will be offered for sale by the vendors. Approximately R40-million is anticipated to be raised through the private placement.
The listing will provide for the smooth unbundling of the current shareholder structure, the introduction of TCS’ strategic empowerment partner, Mvelaphanda Holdings, and the consolidation of the group and its future vision. The transaction also includes the 100% acquisition of its operating subsidiary Total Computer Services (Pty) Ltd and the establishment of a new independent board of directors and management team.
Shaheed Mohamed, CEO of TCS, says: “We are proud to be listing on the AltX and excited about the future of our company. TCS has enormous growth potential and our diversification strategy will further enhance our delivery of value added products and services to our clients. Mvelaphanda will play a very valuable role in determining our future direction and strategy. ”
The company has a national presence in the road traffic management industry, currently providing integrated solutions to its clients at over 112 sites. TCS products and services currently include:
* Technology products such as road traffic equipment required to measure speed, traffic flow patterns and detect offender vehicles on the road;
* Application software products developed incorporating exhaustive in-house research and development to cater for a wide range of traffic management applications; and
* Various solutions to promote and enhance the finalisation of traffic offences as part of the integrated solution.
“TCS is the largest provider of law enforcement technology, software and services in SA. We assist the municipalities with flexible, customised solutions that are technology independent. We have no budget constraints as experienced by Government agencies and our services are implemented to local and provincial authorities at no cost for the infrastructure provided. TCS’ growth potential lies in our products, we at all times anticipate future needs in the industry and set the benchmark high for our competitors,” says Mohamed.
One of TCS’ visionary products is viewfines.co.za; this product enables a driver to view his/her traffic fines online. The product furthermore makes suggestions on where to pay the fine. TCS currently has over 14 000 pay points available to consumers; these include bank ATM’s, Post Offices and all Easypay collectors.
“One of our goals is to change the fine payment culture of South Africans. We are always looking to develop products, like viewfines.co.za, that enables the consumer to pay their fines easier and more conveniently. That is how our end-to-end solution achieves finalisation rates of 50%-65%, well above the national average of 20%," says Mohamed.
The company’s revenue is earned on a fixed fee basis, based on the number of offences that have been finalised. TCS plans to extend its offering to include risk and revenue management service in both the public and private sectors. This diversification strategy will allow TCS to tap into the R50 billion revenue management market.
The listing will provide TCS with the necessary resources to grow its operations via enhanced product offerings and to help achieve its vision of entrenching TCS as the supplier of choice to the law enforcement agencies of South Africa and to take advantage of the immediate opportunities that are available within the current economic climate. In the longer term, the company seeks to launch its proven technology solutions in the international market.
TCS will grow its revenue through organic growth and acquisitions, both of which require added infrastructure and therefore an increased level of financial commitment.
"The further development of the brand will be greatly advanced through a listing on the JSE. This credibility and trust is particularly important with regard to existing and new clients as well as staff in new regions," adds Mohamed.
TCS’ revenue for the year ending February 2007 was R115m. Forecast Revenue for the years ending February 2008 and 2009 are R119-million and R162-million respectively. The company has a forward PE of 6.2.