ABCH shareholders back US$50m rights issue

Munatsi told businessdigest this week that the group’s top 20 shareholders had committed to the capital raising.

Asked if there was any risk at all of minorities withholding waiver for the rights issue, he downplayed this saying underwriters would step in.

“We do not expect this to happen. Our top 20 shareholders have already indicated support for the transaction. In the rare event that this should occur, we also have the support from our major shareholders and underwriters who have the capacity to buy up any slack that may arise,” Munatsi said.

ABCH’s planned US$50 million rights issue scheduled for next month will be the highest a company raised from shareholders post dollarisation.

“We are very excited about the prospects for the group and are grateful for the vote of confidence that our shareholders have given to us in supporting the fundraising effort,” said Munatsi.

“No Zimbabwean company has ever raised US$50 million and this will be the first time any Zimbabwean company has raised such an amount from its shareholders.”

Munatsi expressed his confidence that the fundraising effort will meet shareholder expectations and gain their full support.

ABCH has sought the support of its minority shareholders for its US$50 million rights offer that is scheduled for early next month, through a circular to shareholders sent out this week.

The company, which has its primary listing on the Botswana Stock Exchange (BSE) and a secondary listing on the Zimbabwe Stock Exchange, said  it is seeking a special waiver from minority shareholders to enable the rights offer to proceed.

The company also needs a resolution of shareholders to amend its articles and memorandum of association and the adoption of a constitution pursuant to a section 43(3) of the Botswana Companies Act.

In terms of the BSE Listing requirements, if any person including an existing shareholder acquires 35% or more of the ordinary issued shares of a listed company, that person is obliged to make an offer to the rest of the other “minority” shareholders at the same price that they have accumulated the 35% stake.

ABCH seeks a waiver from the BSE, which can only be granted after a special dispensation has been obtained through a special resolution of ordinary shareholders at the general meeting to be held on 30 May 2012.

A major shareholder — African Development Corporation — which has 23,20% stake in the group has offered to underwrite the rights offer and follow its rights in the transaction.  This means that ADC will be taking up any shares not subscribed to by existing shareholders at the close of the rights offer, potentially taking its holding beyond the threshold 35%.

Should this happen, ADC would then be obliged to make an offer to all other shareholders of ABCH to acquire all the shares held by them at the rights offer price of BWP4,28 or the US dollar equivalent thereof  per share.

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