The Golden Age Of Technology Giants: CWG Lists Her Shares On NSE

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On November 15, 2013, Computer Warehouse Group Plc (CWG)
shall be the first company to be listed on the Nigerian Stock Exchange
following the launch of the new trading engine, X-Gen, which incidentally is
the same engine that is used on the NASDAQ. The listing of the shares is
expected to boost the market capitalisation of the NSE with about N14 billion,
while CWG would be the highest capitalised security in the ICT sector of the
exchange.
The NASDAQ and the NYSE have also recently witnessed a boom
in Technology listings with Facebook, Google and LinkedIn. Twitter has also
recently revealed her listing plans. This seems to be the golden age of
technology companies, as the stocks have done outstandingly well post listing.
For instance, Google’s shares have gained a whopping 773% post listing while
LinkedIn and Facebook have gained 160% and 29% respectively (as at October 04,
2013). Twitter seems set to follow in this trend with quarterly revenues up
105% to $139m from a year ago.

Here in Nigeria, CWG’s story has not been different. With
seed capital of about N160,000 in 1992, CWG received a valuation of
N6.97billion in 2009 from Vetiva Capital for her private placement. The issue
was oversubscribed; with Private Equity firm Aureos Capital LLC taking up a
major chunk, defying the gloomy atmosphere of the global economic downturn at
that time. The valuation resulted in an increase in invested capital of 4,400
times, meaning that an initial investment of $1000 in 1992 would have yielded a
whopping $4.4m within just 20 years. This achievement put the company in the
bracket of the one of the best global value creators. CWG seems to be on track
to repeat this feat on her listing, at a target share price of N5.48, almost
doubling her private placement price of N3.40 in 2009 albeit in a very
difficult environment characterised by significant slowdown in global economic
growth. 
It is therefore not surprising that that the Ministers of
Finance, Trade and Investment and Communication Technology recently joined
hands with the CEO of the Nigerian Stock Exchange to aggressively canvas for
more Technology listing towards achieving the goal of the NSE to reach a market
capitalisation of $1trillion within a decade.
CWG’s Founder and Chief Executive Officer, Austin Okere
confidently declares that “our best is yet to come”, amidst comment from
sceptics that all previous Technology listings on the Nigerian Stock Exchange
have lost significant value. Hear him; “the value of the stock is affected by performance
and perception of potential. The stock also reacts negatively to swings in
revenue, preferring predictability in forecasts”. He continues “CWG has over
the years built a large proportion of her turnover into annuities from
deploying her own Intellectual Property (IP), to enable financial inclusiveness
in Mobility, such as the recently announced Yello Diamond Account, which will
bring banking services to over 55 million Mobile phone subscribers, and the MTN
XaaS product, which will provide Financial services in the cloud for the over
1000 Microfinance banks and their customers on a pay as you use basis”. The
product rides on cloud computing to bring competitive advantage to relatively
smaller banks which would otherwise have been disenfranchised. According to him
about 12 of the large banks in Nigeria run on the Finacle Core banking
Application, which CWG jointly promotes in West Africa with the application
developers, Infosys of India, processing over 60% of all financial transaction
in Nigeria and used by the likes of FBN, UBA, Stanbic IBTC, Fidelity and FCMB
amongst others.
CWG has taken advantage of her early mover status in the
surge in ICT outsourcing demands to provide the service for the largest
telecommunication company and the largest Downstream Company in the Oil &
Gas sector in Nigeria. This further assures annuity income that smoothes
revenue swings and brings predictability to income. According to Austin, about
80% of the company’s revenue is from repeat business, and new customers are
more likely to be from referrals.
CWG is a strong player in the ATM business, providing and
supporting over 30% of the country’s ATM installed base in conjunction with
Wincor-Nixdorf of Germany, global leaders in the field.
Being a skills intensive business, CWG has set up an Academy
to train brilliant youngsters to boost her talent pool. Currently, the CWG
Academy trains over 200 graduates per year in Nigeria and Ghana, and is set to
start in Uganda by mid next year. The company currently employs over 650
people, of which about 80% are engineers, with extra certifications in Cisco,
Oracle, IBM and other Original Equipment Manufacturing (OEM) platforms. The
Company is ISO 9001:2008 certified across all her operations.
  
The stellar performance of the Company has been rewarded by
her peers and regulators with such awards as Top 50 Technology Business
Companies in West Africa, ICT Solutions Provider of the year, ICT Company of
the year, and the CEO as ICT Personality of the year 2012.
CWG has garnered a track record over the years as one of the
most admired companies in Africa. In 2009, the Columbia Business School in New
York published a case study on the Company and appointed Austin Okere as an
Entrepreneur in Residence (EIR), while in 2012, the Legatum Entrepreneurial
Center of MIT Boston, published a video and written case study on the Computer
Warehouse Group as well.
For the second year in a row, CWG was awarded the Most
Outstanding Corporate Social Responsibility (CSR) Technology Company of the
year in 2012. The company has continued to support her host communities by
ingraining social responsibility as an integral part of her business model,
with focus on the education sector.
In the quest to be the leading Pan African ICT Company, CWG
has actualised her geographical expansion plans with operation in four African
countries; Nigeria, Ghana, Uganda and Cameroon, and virtual operations in 17
other countries. The Company has 18 offices and support centres across Nigeria,
including Lagos, Abuja and Port-Harcourt.
 The company seems well set to achieve her vision of being
the number one IT Utility enabler in Africa by 2015.

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