Seed-Co Limited — the local associate of regional seed manufacturer Seed-Co International — will resume trading on the Zimbabwe Stock Exchange (ZSE) today, the ZSE confirmed in a statement released on Friday.
The shift back to the ZSE comes after the group shelved plans to merge Seed-Co Limited with Seed-Co International, which trades on the United States dollar denominated Victoria Falls Stock Exchange (VFEX).
Seed-Co cancelled the merger plans after the Reserve Bank of Zimbabwe (RBZ) did not approve the transaction. The development means that SCIL and SCL will continue to operate as two separate companies, listed on the VFEX and ZSE, respectively.
“The Zimbabwe Stock Exchange Limited hereby notifies the investing public of the resumption in trading of Seed Co Limited shares on the ZSE trading platform with effect from Monday 21 June 2021,” said ZSE chief executive, Mr Justin Bgoni, in a statement.
“The ZSE sought and was granted permission by the Securities and Exchange Commission of Zimbabwe to resume trading in the shares of Seed-Co.”
Following an offer to Seed-Co shareholders by Seed-Co International Limited to acquire the entire issued shares in Seed-Co in exchange for new issued shares in SCIL, Seed-Co applied for voluntary termination of its listing on Zimbabwe Stock Exchange Limited pursuant to Section 11 of the ZSE Listing Requirements, said Mr Bgoni.
“ZSE noted that Seed-Co no longer met the minimum free-float for a listed company defined in section 87(d) of the ZSE’s Listings Requirements since SICL had acquired circa 95 percent of Seed-Co and was now pursuing drag-along provisions,” he said.
“However, SICL could not fulfil one of the conditions precedent to the completion of the transaction; the Reserve Bank of Zimbabwe Exchange Control approval.
“Resultantly, Seed-Co has withdrawn the application for delisting and will revert to the status quo as the contemplated transaction has been abandoned for the reason stated above,” added Mr Bgoni.
“Trading in Seed-Co Limited shares on the ZSE will resume with effect from 21 June 2021.”
The company’s shareholders approved the transaction earlier in March but the External Loans and Exchange Control Review Committee turned down the proposal that same month as well as an appeal on June 8. The Chronicle