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Edgars cedes $25m to workers’ scheme

By Oliver Kazunga

Listed clothing giant Edgars Stores Limited seeks to award $25.4 million to its Employee Community Share Ownership Trust, which will result in the company fully complying with the 51 percent indigenisation regulations. Under the Indigenisation and Economic Empowerment Act, foreign-owned entities operating in the country should sell 51 percent shareholding to locals.

In a notice to members, Edgars said directors had been authorised to carry out any necessary consequential amendment to the memorandum and articles of association of the company for purposes of giving effect to the special resolution.

“The directors be and are hereby authorised to do all that is necessary to make available to Edgars Stores Limited’s Employee Share Ownership Trust $25.4 million ordinary shares equivalent to 9,24 percent of the total issued share capital of the company, which shareholding shall result in the company meeting the 51 percent indigenisation threshold provided for in the Indigenisation and Economic Empowerment Act (Chapter 14.33) and regulations thereunder,” it said.

Edgars said the above was a special resolution expected to be passed with or without modification at their upcoming annual general meeting set for June 7, 2017 in Bulawayo.

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“The rules of the Employee Share Ownership Trust will be available for inspection at the company’s registered office at least 14 days before the meeting. Each member is entitled to appoint one or more proxies (whether a member/s of the company or not) to attend, speak and vote at the meeting in his or her stead,” said Edgars.

The clothing retail giant has resolved to direct its focus on cost reduction initiatives after its profits dropped to $4 million for the year ended January 9, 2016.

During the comparable period last year, Edgars posted a $5.2 million profit.

The drop in the group’s turnover was mainly attributed to a drop in Edgars’ chain sales, which were down 24 percent from 2014.

This was from a high base of extended credit having been launched in the previous year and so they expected reduced turnover.

Edgars Stores is a limited company incorporated and domiciled in Zimbabwe whose shares are publicly traded.

The group’s core business is in the retailing of clothing, footwear, textiles and accessories. The Chronicle