Full service - JSE MAGAZINE

Full service

With the majority shareholding acquisition of Link SA, the JSE is making it easier for listed companies to communicate with and understand their shareholder base

Full service

On joining the JSE just more than a year ago, Ursula du Plooy, Head of Company Services, was tasked with caring for and maintaining JSE relationships, particularly those with listed companies. Her visits to clients proved, she says, informative.

‘The JSE has always looked after their issuers, particularly from a regulatory point of view, but what became clear was that no one was looking after the individual shareholders,’ says Du Plooy. ‘We saw this as an opportunity and, in response, set up an advisory council comprising the company secretaries of some of the JSE’s top 20 clients – inclusive of smaller organisations – to judge and evaluate the need. ‘It was enlightening. Their counsel provided us with an understanding that the JSE was seen as a solutions-provider, and that if we could create a centralised communication hub for shareholders, for both listed or unlisted companies, we would be able to broaden our reach and bring more love to the JSE from the listed companies who do not have the means to reach end-user shareholders.’ This is essentially the task of a transfer secretary, whose role it is to maintain the registers – both electronically and on paper – of the listed company’s individual shareholders, and to transfer shares from old to new owners.

In not wishing to reinvent the wheel, the JSE proposed to deliver this service to issuers through the acquisition of a majority shareholding of Link SA, which would expand JSE services to end-to-end products, essentially creating, as Du Plooy explains, a one-stop shop. ‘It’s an ideal vehicle to add more value to our issuers because we can now fulfil an entire value chain in shareholder communications and services. And because it is a locally based service, it has the extra advantage of being more cost-effective than using global agencies to perform the role,’ she says.

Through Link SA, the JSE intends to introduce end-to-end products and services to JSE-listed companies, making it easier for them to communicate with and understand their shareholder base. Subject to all required approvals, these services include shareholder-register maintenance, corporate actions, shareholder analytics, managing BEE share schemes, electronic communication and voting, and training and educating shareholders.

The transaction will enable the JSE to diversify revenue and extend the services it already offers listed companies through its Company Services team, which includes training, investor-relations support, and hosting listed companies’ annual and interim results meetings and presentations. ‘Further, this service expands to include unlisted companies, those that may have share schemes or offshore investments, whose registers we can manage,’ says Du Plooy.

Link SA is to be merged into the JSE Limited structure but will operate independently. The exchange retains the existing CEO of Link SA, Iqbal Haniff, who has 30 years of experience in this market. The transaction is revenue accretive, with an expected contribution of up to 6% of group revenue, while exceeding the group’s return-on-investment hurdles.

Significantly, as Du Plooy points out, in the current economic climate, opportunities to be innovative are a challenge. The Link SA stream, along with the introduction of AGM hosting at the JSE (which was launched last year), proves that the bourse is adaptive, creative and responsive to market needs. ‘What is also going to prove very valuable to the everyday individual is that we will be working very hard to reach those who have unclaimed dividends, which could prove a lifesaver for individuals who have lost touch with their investment.’

By Kerry Dimmer
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