HomeBusiness DigestZimsun to list its property division

Zimsun to list its property division

Conrad Dube

DAWN Properties, Zimsun Leisure group’s property company, is set to become the 81st listed counter and the fourth company to list on the Zimbabwe Stock Excha

nge (ZSE) this year.

Sources said the listing of the property company as a stand-alone unit had gone through “the final stages of due diligence” and was in line with the group’s intention to demerge.

They said the company’s prospectus would be released to the market either today or early next week.

Zimsun chief executive officer Shingi Munyeza could not comment saying shareholders would be advised of the latest developments in due course.

“I cannot shed any light on that at the moment,” he said.

But sources said Dawn Properties would have its own board of directors and management to allow Zimsun to concentrate on core business.

Zimsun issued a cautionary statement in March to the effect that directors of the company were “giving in-depth consideration to a restructuring of the company with a view to unlocking shareholder value and substantially strengthening the operating base.

“Full details thereof will be advised to shareholders at the earliest possible date, and placed before them for approval at an extraordinary general meeting,” the company said.

In a statement accompanying the March 31 2003 results, Zimsun said for many years the value of the real estate owned by the company had not been reflected in the market value of the company.

It said the board had sanctioned a demerger of these properties and once approved by shareholders and the regulatory authorities, the new entity would drive the value for the real estate interests of the shareholders. The process is in line with international trends which allow the company to focus on hotel and leisure management skills, the company said.

Since the demerger from Delta Corporation Ltd as well as management changes after a consortium led by Munyeza acquired 35% of the shareholding, the company has returned to profitability.

Analysts said the success of the former Astra group companies, Astra Industries, Cairns Holdings and Tractive Power Holdings and the former TH Zimbabwe companies, General Beltings, Steelnet and Turnall after unbundling could have inspired the leisure group into unbundling.

Astra group companies’ sum total at $625 on Wednesday this week was 2 258% above the August 17 2001 sum total of $26,50 while the former TH Zimbabwe group companies at $191 was 627% up on the November 2002 listing sum total of $26,25.

“The group has realised that keeping both the properties and hotel divisions under one management would not allow management to focus on core business. The management has also noted that the value of the sum of parts would be greater than the combined company,” said an investment analyst.

Zimsun shares gained 52% to $55 from $36 on March 6.

Recent Posts

Stories you will enjoy

Recommended reading