Old Mutual’s Zimbabwe unit to trade on Alternative Trading Platform

By: 
Business Report

OLD Mutual's Zimbabwean unit will start trading on the Financial Securities’ Alternative Trading Platform (ATP) on Thursday under an indigenisation programme agreed between the company and the country five years ago.

The unit said it had opted to list the shares on the ATP in pursuit of broadening market participation and to enhance the company’s brand availability in the Zimbabwean market - where it had interests in insurance and other financial services sectors such as banking and life assurance.

London-based Old Mutual is among foreign-owned companies in Zimbabwe that also include Impala Platinum - which has just approved a new mine for Zimbabwe - as well as units of PPC, Anglo Platinum, Standard Bank and ­Anheuser-Busch InBev.

The ATP was approved and operationalised by authorities in Harare. It is regulated by the Securities Exchange ­Commission. In the interim period to June this year, Old Mutual Zimbabwe posted a pre-tax profit of $15.9million (R223m), up from the $14.6m recorded during the corresponding period last year.

“In pursuit of the company’s approved indigenisation implementation plan, a total of 83011718 issued and fully paid B Class shares in the capital of the company have been set aside for allocation or have been allocated to the approved shareholders,” Old Mutual Zimbabwe said.

Zimbabwe is pushing an empowerment drive seeking to compel foreign shareholders to cede 51percent shares to black groups in the country but recently softened its stance, highlighting that existing foreign companies would be allowed to retain control of local units.

Shares in the financial services company to be traded on the ATP will have a nominal value of $0.0000032 each.

Old Mutual also controls a building society, Central ­African Building Society in Zimbabwe.

Old Mutual’s stock on the Zimbabwe Stock Exchange (ZSE) - which trades at a ­premium - was nearly stagnant at $3.39, with total shares traded amounting to $18823.

The ZSE turnover closed the month of November 19.36percent stronger at $3.4million after Delta Corporation saw share trade volumes surge to 3.3million shares at an average price of 84c.

Yesterday foreign investor sales on the ZSE had a value of $2.2m while foreign investors bought $1.8m shares.

For the month of November, data from the ZSE showed, turnover rose to $23.4m from $23.2m in October.

Zimbabwe this week introduced bond notes (local currency backed by a $200m Afreximbank facility) that have equal value to the US dollar and this is expected to fuel inflation and lead to commodity shortages as importers would be unable to secure foreign currency to restock.

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