 |
|
|
| |
|
|
| |
|
|
| SEGMENTAL
REVIEW |
| CORPORATE
FINANCE |
| |
|
| Performance
for the year |
|
|
|
|
2006 |
2005 |
| |
US$m |
US$m |
|
|
|
| Revenue and other income |
7,8 |
3,8 |
| Profit from operations |
0,9 |
0,1 |
| Closing capital employed |
(2,3) |
(0,4) |
| Return on equity before |
|
|
| taxation (%) |
n/a* |
n/a* |
|
|
|
|
| * |
Brait's Corporate Finance operations
are organised and structured to utilise minimal capital |
|
| |
| During the period under review, Brait's Corporate
Finance team has been at the forefront of the development of
the debt markets in South Africa. This is best evidenced by
Brait's role as lead arranger for two of the first four high
yield Eurobonds raised for South African companies. |
| |
| Overview
of Corporate Finance |
In the year under review, Brait Corporate Finance
provided market leading debt advisory products and services,
as well as M&A advisory services, to both South African
and international companies.
M&A advisory provided advice, execution, process and transaction
management for acquisitions and disposals. Services included
in these functions are the provision of strategic advice, valuations,
transaction structuring and deal negotiation. Additionally,
the team provided advice on the listing requirements of the
JSE Limited and the Securities and Regulation Code on Takeovers
and Mergers ("the Code") of the Securities Regulation Panel,
capital structure, and selected sponsor related activities.
The services and products provided by Specialised Debt Finance
include debt origination and distribution, capital structure
optimisation, structuring of innovative debt solutions, negotiation
with third party funders and preparation of and advice on documentation. |
| |
| Financial
results and commentary |
Operating earnings for the year from Corporate
Finance were up to US$0,9 million, from US$0,1 million the previous
year.
Despite a seemingly promising pipeline of transactions mid-year,
the M&A advisory unit failed to convert mandates and work
in progress into fee income, recording a US$2,1 million operational
loss for the period. This result was disappointing considering
the efforts in prior years to refocus the business and the generally
positive market environment. This loss, which follows a number
of years when the unit has under-performed, has resulted in
the post year-end decision to restructure the unit to focus
on supporting on-balance sheet investment and providing advisory
services internally.
Brait is currently working with clients and the M&A international
network to determine how best to accommodate each client's individual
circumstances within the new structure.
The Specialised Debt Finance business unit ("SDF") was the main
generator in fee revenue for Corporate Finance recording operational
earnings of US$3,2 million for the period under review. Debt
in excess of US$800 million (ZAR5 billion) was raised for clients
within a broad range of transactions and debt types. |
| |
| |
| Revenue |
 |
| |
| Page
up |
| |
|
|
|
|
|
|
| |
|
 |
