CFX paves way for Interfin takeover

CFX Financial Services Ltd shareholders yesterday passed all resolutions which had been tabled at the Extraordinary General Meeting paving way for Interfin to inject capital and subsequently take control of the company.

Company secretary Patricia Ndoro yesterday said the resolutions passed include re-denomination of the authorised share capital, increase in ordinary authorised share capital, creation of preference shares in the authorised share capital, ordinary share capital private placement and control of authorised but unissued share capital.
Ndoro said the authorised share capital of the company would be re-denominated from 10 billion ordinary shares of ZW$0, 0001 (old currency) nominal value each to 10 billion ordinary shares of US$0, 00001 nominal value each.
“Directors will be authorised to transfer from the capital reserves an equivalent of the nominal value of the issued share capital to fund the above re-denomination and this will amount to US$62 507,” Ndoro said.
CFX’s shareholders passed a resolution that the authorised share capital be increased from 10 billion ordinary shares of US$0,00001 nominal value each to 50 billion ordinary shares of US$0,00001 nominal value each. Exiled businessman Gilbert Muponda had sought to block the EGM through his lawyers Gutu & Chikowero Attorneys threatening to take legal action against the company if it proceeded with the shareholders meeting.
CFX, which is currently facing viability problems, reportedly needs a capital injection to meet minimum capital requirements set by the Reserve Bank. The extraordinary general meeting, according to a cautionary statement issued by CFX, would raise share capital by increasing ordinary authorised shares.
Interfin Holdings is said to be firm favourite to acquire a controlling stake in CFX Financial Services ahead of the Finance Bank of Zambia.
At the EGM yesterday shareholders also unanimously passed that 50 billion, irredeemable non-convertible non-cumulative preference shares of US$0,00001 nominal value each be created into the authorised share capital of the company in terms of Articles 4, 50 and 52 of the Company’s Articles of Association.
These preference shares are to be placed under the control of company directors.
On the renounceable rights offer CFX shareholders agreed that the directors of the company be authorised to offer renounceable rights of ordinary shares of US$0,00001 nominal value each in the company’s authorised share capital to existing holders of the company’s ordinary shares by close of business yesterday, at a subscription price of US$0,0007 per ordinary share.
This will be on the basis of 23 rights offer ordinary shares for every 10 ordinary shares already held, and to issue and allot such shares as may be subscribed pursuant to the rights offer to such shareholders, their renounces or underwriters as the case may be.
The directors of the company were also authorised to issue ordinary shares of US$0,00001 nominal value each in the company’s authorised share capital. This will be at a price to be determined by applying a 10% premium to the rights offer price, to the underwriter through a private placement only to the extent it may be necessary for the purpose of ensuring that the underwriter obtains a maximum of 51% stake in CFX’s issued ordinary share capital post the rights offer. Shareholders also agreed to waive their pre-emptive rights.
On preference share capital private placement the directors of the company were authorised to issue, for US$0,0007 each, irredeemable non-convertible non-cumulative preference shares at Libor + 5% per annum to the underwriter through a private placement for any balance of the unsubscribed rights offer shares remaining after satisfying the requirement of the 51% capitalisation.
The shareholders also agreed that the balance of the authorised but unissued shares of the company after the proposed rights offer, be placed under the control of the directors for an indefinite period.
This is provided that any issue other than that pursuant to resolution 5 and 6 by the directors shall be in compliance with the company’s memorandum and Articles of Association and the Zimbabwe Stock Exchange’s Listing Rules.”

 

Paul Nyakazeya

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