Intravenous Infusions Limited (IIL), Ghana’s market leader in the supply of intravenous (IV) fluids, is set begin its initial public offering this Wednesday.
IIL is offering 150 million ordinary shares valued at GHS 0.08 per share in an Initial Public Offering (IPO), which starts from October 14 and ends on November 25, 2015. The intention is to raise GHS 12 million.
Having began operations in 1974, Intravenous Infusions Limited (IIL) is one of Ghana’s good-news stories. IIL is the oldest and most reliable indigenous IV fluids producer in Ghana and West Africa.
The Koforidua-based company currently supplies between 50-60% of IV fluids to hospitals and pharmacies nationwide, and exports approximately 10% of its products to neighboring countries such as Cote D’Ivoire, Burkina Faso and Togo.
Unlike many other companies struggling to find and grow clients, IIL operates in a niche area of the pharmaceutical industry that does not depend on the economy being up or down, how much you or I earn and does not go out of style.
For IIL, its limitation is its ability to produce enough of its product to meet the ever-increasing demand. While the company has the capacity to produce 4.5 million bags of IV fluids per year, the aging machines and manual processes have seen production fall over the last few years. As such, IIL has been unable to meet demand from both local and neighboring countries. About 6.7 million bags of IV fluids were used in Ghana in 2014, and this is expected to grow by approximately 50% in the next five years.
The launch of the IPO will give Intravenous Infusions the opportunity to consolidate its market leadership position in
Ghana and further increase its footprint in the ECOWAS region.
The expected injection of capital will allow IIL to complete installation of a new production plant to increase capacity from the current 4.5 million bags to 15 million bags of IV fluids per year (installation is currently 90% complete), fully exploit untapped market opportunity in ECOWAS by growing export revenue from 10% to 45% over the next 5 years, improve its balance sheet and working capital and further diversify its business into the sale of over-the-counter medication.
During a recent Fund Manager’s meeting at the Databank Head Office in Accra, Mr. Richard Okrah, Managing Director of Intravenous Infusions Limited said, “IV fluids are not products most people think about on a daily basis.
However, it is critical in the treatment of tropical diseases such as malaria, typhoid fever and cholera and emergencies including accidents, burns and food poisoning. IIL is also the only local producer of Magnesium Sulphate, which is used to treat pregnant mothers with hypertension. This product is critical as the government works to implement its Zero Maternal Mortality Policy, and Intravenous Infusions is well-positioned to be a key partner.”
He continued, “Not only will the IPO afford us the ability to meet growing demand in Ghana and beyond, it will also significantly increase our ability to help save lives – maybe even mine or yours, one day. Therefore, I want to encourage everyone to invest in IIL.”
IIL’s shares will be available for GHS 0.08 per share. During IIL’s IPO, you can become an IIL shareholder with as little as
GHS 80 (i.e., 1,000 shares), and continue to purchase additional shares in multiples of GHS 40 (i.e., 500 shares).
