Rainbow Tourism Group foreclosed on an amount owed by defunct Capital Bank through a $3 mln share transaction on the Zimbabwe Stock Exchange last week.
RTG had around $2 million trapped in the now defunct banking institution. This was after the company had channelled a regional facility of $7 million through the bank. Regional lender Africa Export and Import Bank (Afreximbank) released the funds to enable RTG to spruce up its units.
The loan was channelled through ReNaissance Merchant Bank (RMB), which also shut down in 2011 under the weight of alleged corporate governance deficiencies. The National Social Security Authority sought to bail out RMB by pouring fresh capital into the bank, rebranding it to Capital Bank, and bringing it back onto the market in 2012. However, during a wave of bank failures between 2012 and 2014, NSSA, the major shareholder, surrendered Capital Bank’s licence, saying it had no cash to fund its recapitalisation. RTG cleared the debt with the lender in 2017. NSSA is RTG’s majority shareholder.
But now during Friday’s trades on the ZSE, RTG foreclosed on the shares held by Capital Bank in FML after 25 million shares were traded with a value of $3,1 million. The shares represent about 3% of the group. The shares traded at 12,4c on the day. RTG finance director Napoleon Mutukwa confirmed the foreclosure but could not provide details as the company is in a closed period.
