Titan Footwear — Funding Requirements & Capital Structure
Titan Footwear requires ZAR 45,000,000 in total funding to establish operations, acquire machinery, build working capital, and sustain the business through the initial ramp-up period until self-sustaining cash flow generation (anticipated within 12 months of commercial production commencement).
Section 12 · Business Plan
Funding Requirements & Capital Structure
Titan Footwear requires ZAR 45,000,000 in total funding to establish operations, acquire machinery, build working capital, and sustain the business through the initial ramp-up period until self-sustaining cash flow generation (anticipated within 12 months of commercial production commencement).
Structured across equity and debt, with an average DSCR of 2.7x and a Year-5 return on equity of 33.4%.
12.1 Total Funding Required
Titan Footwear requires ZAR 45,000,000 in total funding to establish operations, acquire machinery, build working capital, and sustain the business through the initial ramp-up period until self-sustaining cash flow generation (anticipated within 12 months of commercial production commencement).
12.2 Proposed Capital Structure
| Source | Amount (ZAR) | Terms |
|---|---|---|
| Equity Capital | 27,000,000 (60%) | Founder equity contribution and institutional equity investors. Equity holders participate pro-rata in profits and capital appreciation. No fixed return obligations. |
| Senior Debt | 18,000,000 (40%) | 5-year term loan at Prime + 2% (currently ~13.5%). 6-month grace period on principal. Monthly repayments. Security: first covering bond over plant and machinery, cession of debtors book. |
12.3 DFI & Incentive Opportunities
The Company will actively pursue the following development finance and incentive programmes to supplement commercial funding and improve project economics:
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Department of Trade, Industry and Competition (dtic) Production Incentive Programme: Up to 10% grant on qualifying manufacturing investment.
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Industrial Development Corporation (IDC): Potential for concessionary debt financing at below-market rates for qualifying manufacturing projects.
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Jobs Fund: Performance-based grants for qualifying job creation in manufacturing.
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Section 12I Tax Incentive: Accelerated depreciation allowances on qualifying manufacturing assets, providing tax shield benefits in the initial investment years.
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MERSETA Training Grants: Co-funding for accredited skills development programmes aligned with the company’s training academy.
12.4 Investor Returns Profile
Equity investors will benefit from a combination of capital appreciation and dividend distributions commencing in Year 3. Based on a conservative Year 5 EBITDA multiple of 5.0x (aligned with comparable manufacturing businesses), the implied equity value at Year 5 is approximately ZAR 263.7 million, representing a money multiple of approximately 9.8x on the initial equity investment of ZAR 27 million. Dividend distributions of 20–30% of net profit will commence from Year 3, providing cash returns to equity holders during the investment period.
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