Equity raising to gather pace, says Acuity Partners

Wednesday, 2 February 2011 00:28 - - {{hitsCtrl.values.hits}}

Investment banking firm Acuity Partners said yesterday that equity raising in the country would gather pace in tandem with post-war rebound in private sector sentiments.

“We forecast significant growth this year onwards,” Acuity Partners Managing Director Ray Abeywardena told the Daily FT.

Acuity, which is a joint venture between DFCC Bank and HNB, has had a busy start in the New Year by being engaged in three major exercises. It was the financial advisor and manager in addition to being the co-placement agent for the country’s biggest ever private placement of Rs. 4.9 billion by Vallibel One Ltd. (VOL), which turned out to be an overwhelming success, drawing Rs. 7.6 billion worth of applications.

It was the sole financial advisor and manager of 2011’s inaugural IPO of HVA Foods Ltd., worth Rs. 319 million. This IPO was oversubscribed by 23 times with applications worth Rs. 7.5 billion received. Additionally, Acuity Partners is involved in the upcoming Union Bank IPO, which plans to raise Rs. 375 million.

Acuity’s optimism over revival in equity raising via capital markets is in line with the Securities and Exchange Commission (SEC) revelation in January that it expects over 50 IPOs this year.

“With a large number of IPOs planned, the overall capital market will get a boost. With opportunities come competition and given our track record of placement and marketing strength, we are confident of making headway,” said Abeywardane, who counts 25 years in the equities market.

Acuity Partners’ Corporate Finance Division is headed by Shehan Cooray, whilst the company has benefitted by the convergence of expert staff from both DFCC and HNB. Acuity also harnesses the extensive branch network of HNB as well as DFCC Group, which includes commercial bank DFCC Vardhana to promote investments in equity.

Part of the success of its initiatives on the Vallibel One Ltd. private placement as well as HVA Foods is attributed to this. Co-placement agents of VOL private placement were Capital Trust Financial and Bartleet Mallory Stockbrokers.

Abeywardane said some of the concluded and ongoing mandates of Acuity were clinched in the latter part of last year after the overall offering by the company was firmed up in tandem with building the team.

With the success achieved in the first month of 2011, Acuity is gearing itself to help more companies with its portfolio of products and services, which includes corporate finance services, financial advisory, venture capital financing, stock broking, margin trading and fixed income securities.