Ultimatum for CBZHL
CLOUDINE MATOLA
CBZ Holdings Limited (CBZHL), a publicly traded financial services group, has been given until the end of this month to complete a buyout exercise of minority shareholders in First Mutual Holdings Limited (FMHL) in an attempt to take control of the business after surpassing a threshold set by the Zimbabwe Stock Exchange (ZSE), Business Times can report.
It comes after CBZHL acquired a 36.35% stake in FMHL last year.
ZSE mandates that when a person or organization purchases at least a 35% stake in a publicly traded company, an offer must be made to the other shareholders.
Following the acquisition FMHL, CBZHL now owns a 36.35% stake in the business.
It is anticipated that the Competition and Tariff Commission (CTC) will have completed its assessment of the deal by the end of November 2024.
“…..shareholders are advised that CBZHL has engaged the ZSE for a further extension of the time within which CBZHL ought to make a mandatory offer to the remaining shareholders of FMHL because the CTC has not yet finalised its assessment of the transaction.
“At this stage the CTC has communicated to the ZSE that it expects that its board would have made the final decision on the transaction in terms of the Competition Act (Chapter 14:28) by end of November 2024.
“The ZSE has therefore granted CBZHL a further dispensation up to 30 November 2024 within which a mandatory offer must be made to the remaining shareholders of FMHL,” Rumbidzayi Angeline Jakanani, Group Chief Governance Officer said.
With that formidable merger, CBZHL and FMHL would pool their strength to create a strong balance sheet that would position them as dominant players in the market.
The merged company should be able to expand its property and insurance activities and offer services to a broader clientele by utilizing the synergies between the two companies, which will ultimately increase the value.
The acquisition of a stake in FHML coincides with CBZHL’s ongoing negotiations to purchase a majority stake in a complementary company, presumably ZB Financial Holdings Limited, as it aims to become a financial behemoth to attract foreign investment to support national development projects.
According to Jakanani, discussions on the proposed deal are still on-going.
“The directors of CBZHL wish to advise all shareholders and the investing public that the company is still engaged in negotiations for a potential acquisition of a complimentary business.
The acquisition if successfully concluded , may have a material impact on the value of the company’s share until a full announcement is made,” Jakanani said.
