Khaya Cement in crucial shareholder meeting

CLOUDINE MATOLA

Khaya Cement Limited has called an Extraordinary General Meeting (EGM) for May 19, 2025, where shareholders will vote on a pivotal resolution to delist the company from the Zimbabwe Stock Exchange (ZSE) — a move seen as central to its corporate rescue strategy and long-term recovery.

The embattled cement manufacturer, currently under corporate rescue, is seeking shareholder approval to voluntarily terminate its ZSE listing as part of efforts to stabilise operations and execute a focused turnaround plan.

“The Corporate Rescue Practitioner of Khaya Cement Limited is proposing terminating the company’s listing from the ZSE,” said Bulisa Mbano, the appointed practitioner overseeing the restructuring.
“The decision comes after the board of directors voluntarily placed the company under corporate rescue on the 24th of December 2024, in accordance with the provisions of the Insolvency Act [Chapter 6:07].”

Mounting regulatory and operational pressures, including the company’s failure to meet core listing requirements such as the timely release of financial statements, have made continued listing untenable. Remaining on the exchange risked regulatory sanctions, reputational damage, and potential forced removal.

Delisting is a key component of the broader rescue framework, intended to free the company from the constraints of public market reporting and investor scrutiny — allowing management to prioritise operational rehabilitation.

“Delisting is a strategic step to stabilise the company and ensure its long-term recovery,” Mbano said.
“It will allow the company to focus on critical restructuring tasks without public market scrutiny.”

By exiting the exchange, Khaya Cement will gain the flexibility to implement sensitive recovery initiatives — including debt renegotiations, asset disposals, and capital restructuring — away from the public spotlight and disclosure obligations.

“This move enables confidential and efficient implementation of essential measures, such as debt negotiations, cost-cutting initiatives, and asset rationalisation,” Mbano added.

Maintaining a ZSE listing also carries significant fixed costs — such as annual listing fees, audit expenses, investor relations, and compliance advisory services — which are proving increasingly burdensome during corporate rescue.

“Terminating the listing reduces costs associated with maintaining a public listing, freeing up resources for recovery efforts,” Mbano said.

Funds previously allocated to regulatory compliance will be redirected toward recapitalisation, operational turnaround, and working capital support — essential to reviving the business.

Khaya Cement’s shares have already been suspended on the ZSE, creating prolonged uncertainty for investors. The proposed delisting is positioned as a mechanism to clarify the company’s path forward while safeguarding shareholder interests during the recovery phase.

“The company’s shares face prolonged uncertainty and illiquidity. Voluntary delisting resolves this limbo, protects shareholder interests during restructuring, and allows focused recovery efforts to stabilise operations,” Mbano noted.

At the forthcoming EGM, shareholders will vote on special resolutions to approve the delisting. For the resolution to pass, it must be supported by at least 75% of votes cast by shareholders present or represented by proxy, excluding votes from controlling shareholders, their associates, and related parties.

“The special resolutions will require that 75 per centum of the votes of all Shareholders present or represented by proxy, vote in favour of the resolutions, excluding any controlling shareholder, its associates and any party acting in consent,” Mbano explained.
“The Company’s ordinary shares [will] be removed from the main board of the ZSE through voluntary termination of the listing in terms of Section 11 of the ZSE listing requirements.”

The delisting proposal follows the company’s placement under corporate rescue in December 2024, triggered in part by sanctions against an individual linked to major shareholder Fossil Mine.

As Khaya Cement navigates this critical juncture, the upcoming shareholder vote is expected to be a defining moment in its quest to restore operational viability and rebuild long-term shareholder value.