Dawn courts potential suitors

Chris Goko/Roadwin Chirara

DAWN Properties Ltd, the de-merged property arm of Zimsun Leisure Group (Zimsun), has drawn up a provisional list of nine potential suitors which will be cut down to three before J

anuary as the company intensifies revived merger talks, businessdigest can reveal.


Mike Manyika, the company’s chief executive, on Tuesday confirmed the moves, but would not disclose the profile of the merger targets.


Much as Dawn has been persistently linked to another Zimbabwe Stock Exchange (ZSE)-listed property investment firm, Mashonaland Holdings Ltd (Mashold), Manyika would not commit himself as to whether they were also looking at the former Anglo American subsidiary.


“You know that I cannot comment on that (list and merger targets), but as a company we are always looking at opportunities that would add value to the company,” Manyika said at his Tendeseka offices this week, adding he was not regretful of the failed previous merger talks.


“We do not think we made a mistake with proposing a merger and if the timing is right, with the right kind of partner, we are more than happy to do it again,” he stressed.


Dawn, 20%-owned by fellow ZSE-listed Zimsun and managing the latter’s 10 countrywide hotel properties, incurred a $150 million tab for the aborted talks.


Since Manyika denied links with Mashold, he also explained that the breakdown in talks was not linked to property portfolio valuation issues whatsoever.


However, businessdigest learnt in the course of this week that Dawn’s potential targets included both quoted and non-listed companies which are essentially investment vehicles as opposed to brick and mortar companies.

Among Dawn’s merger targets is an unnamed pension fund and an established property retailer whose identity and value could not be readily ascertained.


Sources said the fledgling company was aiming at taking on board a pension fund to access abundant cash resources while the foreseen real estate company would bolster its current operation.


The sole Zimbabwean variable rate loan stock (VRLS) company recently opened a real estate wing to broaden revenue generation avenues.


In presenting the $170 billion company’s results last month, company chairman Farai Rwodzi announced that they would restart merger negotiations in an attempt to source cheap finance.


“We are hopeful that at some appropriate stage in the future these negotiations might be resumed,” the Interfin Merchant Bank number two said at that time.


He said the company was formulating both long and short-term strategies to strengthen its operations ahead of a major assault on both the domestic and other preferred markets.


Although Rwodzi said Dawn was receiving property investment offers from the region which they were “vigorously vetting” to establish common ideals, Manyika said they had no immediate plan to lunge into the region.


Instead, his company was working towards consolidating its presence locally before venturing elsewhere.


Manyika said this would be achieved by way of “finalising internal systems” even before they engaged the cherished local suitors as this would place the VRLS in a better bargain position.


“There has been talk of us having regional plans, but that requires finance… something we currently do not have, so I can safely say (that) we have no concrete plans on that,” the company boss said.


Dawn, formed in September last year, manages Zimsun’s Caribbea Bay, Crowne Plaza Monomatapa Hotel, Elephant Hills, Great Zimbabwe, Hwange Safari Lodge, Lake View Inn, and Troutbeck Inn hotels.


Meanwhile, Manyika said with property investment prospects looking up, he expected the newly-incepted real estate wing to surpass its projected 15% revenue contribution feat and cash earnings.


“By year-end, we are projecting that the real estate business would be contributing 15% to the company’s overall earnings and in 24 months that should be two-fold,” added Manyika.