CTC clears CBZ, FMHL deal

LIVINGSTONE MARUFU

The Competition and Tariff Commission (CTC) has cleared the CBZ Holdings, First Mutual Holdings Limited (FMHL) deal paving the way for the former to acquire a 31.22% stake in the financial services concern, it has been learnt.

The 31.22% shareholding stake in FMHL, one of the leading insurance and property companies in Zimbabwe, was held by the National Social Security Authority (NSSA).

Multiple sources at CTC told Business Times this week that the deal was cleared in the last quarter of 2022.

The deal will give CBZ access to FMHL’s insurance business, which also includes short-term insurer NicozDiamond and reinsurance arms. FMHL also has a vast property portfolio.

“Its (CBZ, FMHL deal) cleared. It was approved in the fourth quarter of last year (2022), one CTC source told Business Times.

Another CTC source said: “The deal was approved as the two are not direct competitors.”

All efforts to get a comment from CBZ were futile.

Although the CBZ and FMHL concluded negotiations last year, the deal was taken to CTC in November last year as one of the several conditions precedent.

Now that the deal has been cleared, CBZ’s stake in FMHL will go up to 34.44%, becoming the second largest shareholder in the company. Prior to acquiring NSSA’s 31.22% in FMHL, CBZ had 3.23% shareholding in FMHL.

Although NSSA has now reduced its FMHL shareholding stake to 35% from 66.22%, the State-owned pension fund remains the single largest shareholder in FMHL.

It is understood both CTC and CBZ will soon make a public announcement.

Last month, CBZ, in a cautionary statement to shareholders and the investing public warned that:

“…The company is still engaged in negotiations for a potential acquisition of a complementary business. The acquisition is successfully concluded, and may have a material impact on the value of the company’s shares, the full impact of which is currently being determined,” Rumbidzayi Jakanani, CBZ’s group legal corporate secretary said.

The FMHL deal comes at a time CBZ is pursuing ambitious plans to extend its influence in the financial services market.

It is reported CBZ is also considering taking over ZB Bank.

In May last year, CBZ Holdings Limited chairman, Marc Holtzman said the country’s leading financial services group was considering listing on the United States dollar-denominated Victoria Falls Stock Exchange.

He said the group was also seriously considering expanding into the region.