HomeBusiness DigestCompanies operate in breach of stock exchange regulations

Companies operate in breach of stock exchange regulations

Eric Chiriga

SOME listed companies continue to violate Zimbabwe Stock Exchange regulations by owning shareholdings of more than 70% against rules.

ca, sans-serif”>According to ZSE listing requirements, at least 30% of the issued equity capital for which a quotation is being sought must be offered to the public.

Innscor Africa Ltd now holds 76,6% stake in Colcom Holdings from 43,3%. The stake was increased after an unconditional offer to minority shareholders of Colcom.

When asked for comment, the chief executive officer of Innscor, John Koumides, said they were not the only listed company that held more than the prescribed 70%.

“The Zimbabwe Stock Exchange should let us know if we are violating their regulations,” he said.

“If you look at the share register of Barclays Bank, Cafca and several other companies listed on the ZSE, you will see that less than 30% shares are held by the public,” Koumides added.

David Whitehead is another company where the public holds less than 30% of issued equity capital.

In David Whitehead, a company called Guscole Investments has a shareholding of 88%, leaving only 12% for public.

The company has also not published its year-end results which under ZSE rules should be presented during the first three months of the financial year-end.

Edwin Chimanye, the chief executive officer of David Whitehead, could not be reached for comment.

However, Emmanuel Munyukwi, the chief executive officer of the ZSE, said

they were taking measures against companies which are violating the exchange regulations.

“The issue is being addressed but I cannot disclose how we are going about it,” Munyukwi said.

He said there were different reasons why a company might hold more than 70% shares and if “we are satisfied with their explanation we give them time to adjust”.

Also under the listing requirements of ZSE, the Memorandum and Articles of Association of the company must comply with the requirements of the exchange as required by law.

The stock exchange also requires that the spread of shareholders existing at the close of an offer is sufficiently wide to justify the listing. Approximately 300 shareholders are regarded as a minimum.

The ZSE operates in terms of and under the authority of the Stock Exchange Act (Chapter 24:18).

Recent Posts

Stories you will enjoy

Recommended reading