Zimbabwe Stock Exchange (ZSE)-Listed seed producer, Seedco Limited (SEED.zw) is considering a merger with SeedCo International (SCIL) to strengthen the proposed transfer of the latter’s shares from the ZSE to the Victoria Falls Stock Exchange (VFEX), 263Chat Business has learnt.
The two entities are currently listed separately on the ZSE with SeedCo International also listed on the Botswana Stock Exchange.
However, SCIL remains suspended from the ZSE following government order to keep on suspension all the fungible dual listed shares which were being used by market participants to determine the rate of the local currency.
SCIL this morning confirmed that the company is currently in talks with SEED.zw over a potential transaction that may have a material effect on share price.
“Shareholders are advised that pursuant to the proposal to transfer the ZSE Secondary Listing of Seed Co International Limited from the ZSE to the soon to be established VFEX, a proposal to merge the Zimbabwean operations, held under Seed Co Limited, and the international operations, held under Seed Co International, is being pursued,” said Seedco International Limited.
The merger is informed by the need to make the VFEX secondary listing of Seed Co International Limited competitive and comparable to other Zimbabwean dual-listed counters.
Government of Zimbabwe is laying ground for the establishment of the Victoria Falls Exchange which will be denominated in foreign currency with the hope of turning the resort town into a modern offshore capital center.
To this end, all the dual-listed companies, including property giant-Old Mutual, cement-maker PPC and SeedCo International have since been advised to delist from the ZSE and list on the VFEX.
“Shareholders of Seed Co Limited (“the Company”) and the investing public are advised that the Company has entered into negotiations with Seed Co International Limited (“Seed Co International”) exploring the proposal to integrate SCL’s operations under Seed Co International as part of the latter’s consolidation plan being pursued to strengthen the proposed transfer of Seed Co International’s Secondary Listing from the Zimbabwe Stock Exchange (“ZSE”) to the Victoria Falls Stock Exchange (“VFEX”), a special economic zone bourse that will trade in United States dollars,” SEED.zw confirmed the development.
The ZSE has in recent months witnessed an increase in company mergers leading to a decrease in number of companies listed on the country’s primary bourse.
Earlier this year, property giants Dawn Properties and Zimre Property Investment announced plans to delist and merge with their parent companies African Sun and Zimre Property Holding, respectively.