Board changes are looming at Astra Industries Ltd after the company was taken over by a management consortium and a foreign company, Kansai Plascon, businessdigest can reveal.
Sources close to the deal said a notice on the proposed board changes was awaiting the Zimbabwe Stock Exchange’s listing committee approval.
The sources said respected corporate lawyer Addington Chinake is going to takeover as chairman of the board of Astra from Charles Utete.
Chinake, who has more than 21 years of practice as a lawyer, is the Senior Partner at Kantor & Immerman,a leading law firm in the country. He specialises in Corporate and Commercial law and all aspects of business law.
Utete and Herbert Nkala , according to the sources, will however remain on the board as non-executive directors.
Mohamed Ebrahim and Douglas Thomas will also join the board of Astra Industries. The duo represents the interests of Kansai Plascon.
Executive directors – Mackenzie Mazimbe and Heritage Nhende – will also sit be on the board.
Mazimbe is the Managing Director of Astra Industries, while Nhende is the Finance Director and are the main representatives of the management consortium.
Willard Zireva, Rukudzo Murapa, Acquiline Chinamo, EJ Davies and TM Johnson resigned from the board yesterday.
Hemister Investment, a special purpose vehicle that acquired the Finance Trust of Zimbabwe’s 63,25% of Astra equity stake, is 51% owned by Astra management with the remainder held by Kansai Plascon.
It is understood that a provisional approval by the Indigenisation minister Saviour Kasukuwere has been sought for the transaction while the Reserve Bank of Zimbabwe (RBZ) has also blessed the deal.
The sale of the RBZ shareholding held through the Finance Trust of Zimbabwe was necessitated by the need for the central bank to rid itself of non-core assets.As a result, the central bank has been winding up its non-core businesses.
The sale came after the company hinted the sale of the RBZ equity would be concluded in the second half of the year.Astra reported an after-tax profit of US$496 952 in the half-year to February this year. Revenue increased by 4%, while aggregate sales volumes grew by 3% over the same period last year.
Gross margins declined from 35% last year to 33% this year. Operating profit, at US$615 875, was below the prior period by 44%.
The group achieved a profit-before-tax of US$620 867, down 43% from last year’s US$1 million.
The group’s total assets turnover, a measure of how much assets are being used to generate sales, stood at 0,7. The efficiency is below one, showing under-utilisation of assets which might be due to the pricing policy in light of stiff competition.
Finance costs declined to US$53 904 from US$91 353 during the period under review. The company also announced that in March Lobels issued an unsecured five-year convertible debenture in settlement of its debt to Astra Chemicals with a maturity amount of US$103 436.
The group’s current ratio, which measures the company’s ability to meet current liabilities, stood at 1,99, a figure above the standard minimum of one.