FIRST Mutual Life (FML) and Zimre Holdings Ltd (ZHL) this week said they would only list their property portfolios on proven fundamentals of profitability to the companies.
P>They told businessdigest on Tuesday that they had postponed public offerings due to poor economic fundamentals and company officials said they were now carrying out analyses on the best possible way forward.
Douglas Hoto and Solomon Tembo, respective chief executive and chief operating officer of FML and ZHL, said the respective companies had launched internal studies to establish the viability of listing on the Zimbabwe Stock Exchange (ZSE).
“It (listing) has to have economic sense and that is why we are carrying out further studies on the issue,” said Hoto, adding they were specifically looking at technicalities such as tax implications and shareholder interests.
With properties ranging from industrial units to office parks worth a staggering $160 billion as at mid 2004, FML has since hired former ZHL staffer Francis Nyambiri to drive the pre-listing activities and investment options.
Hoto would not entirely rule out partnerships with other players, saying the FML property team, led by the new property executive, would weigh the options of going it alone and possibilities of bringing on board other parties.
He stressed, though, that the issue of critical mass was essential.
Without revealing potential suitors, the FML group chief executive said they were now hoping to fulfill the listing issue in the second or third quarter of 2005.
Tembo, in the meantime, said his group’s desire to list Zimre Property Investments (ZPI) could only be consummated on the findings of a due diligence exercise they were currently undertaking.
“It is… that appraisal (which) will determine how we are going to go about the listing,” he said, hinting that they still favoured singular approaches to fulfilling the idea.
Given that part of ZHL’s property portfolio is warehoused in other ZSE-listed companies, including Fidelity Life Assurance and short-term insurer NicozDiamond, Tembo declined to comment on ZPI asset valuations.
Acknowledging operational problems currently rocking listed property concerns Dawn Properties Ltd (Dawn) and Mashonaland Holdings Ltd (Mashhold), Tembo said his firm was “keenly following” the two companies progression with a view to strengthening their own rollout plan.
Tembo, declaring that ZHL had pioneered the variable rate loan stock (VRLS) concept in the country, said they had the much-needed critical mass and therefore saw little value in amalgamating with other players.
His sentiments come at a time the current listed VRLS firms — Dawn and Mashhold — have been headhunting for merger partners and themselves rumoured to have pursued mutual talks.
Dawn is a property holding of Zimsun Leisure Group, while former Anglo American subsidiary Mashhold has as its major shareholder, Transnational Holdings.
Dawn authorities, led by chief executive Mike Manyika, said they still favoured mergers if shareholders were to ride the current turbulent economic problems.
“We do not see any merit in listing small property entities. We need critical mass,” Manyika, whose company has shortlisted potential targets, told businessdigest on Tuesday.
Meanwhile, sources said the Dawn has received offers for its Elephant Hills hotel, which are well above its $30 billion market capitalisation.
While company chairman Farai Rwodzi recently said they had received investment offers from the region, Manyika would not comment on the issue.
The company’s share was trading at $42 as of Tuesday.