Board changes are looming at Zimre Holdings Ltd (ZHL) amid indications a new shareholder, who snapped up a 40% equity stake in the group, is seeking board representation.
ZHL CEO Albert Nduna told businessdigest this week that the new shareholder had asked for board representation following a US$15 million rights issue, which saw only 18,03% of the reinsurers shareholders following their rights, leaving the underwriter NMB Bank, to pick up over 80% of the new issued shares.
The development has also seen government’s stake being reduced to around 25% of ZHL’s issued shares.
“We have not finalised the board appointments yet. We hope to finalise them by end of this month. It’s a process that the current board has to deal with,” Nduna said.
He confirmed the new shareholder had made requests through NMB Bank for board seats. With a 40% stake, a shareholder can get a minimum of three directors on the board. However, Nduna would not be drawn into disclosing who the shareholder was. NMB Bank, which underwrote the capital raising initiative, was left saddled with nearly 82% of the unsubscribed for shares.
The fundraising initiative was approved at ZHL’s January AGM in a bid to strengthen the group’s capital base and increase its underwriting capacity.
A total of 750 million new ordinary shares were offered for cash at a subscription price of US$0,02 each to existing shareholders on a basis of one new ordinary share for every 1 041 ordinary shares already held by existing shareholders.