Regulatory delay holds up CBZ Holdings’ acquisition of First Mutual Holdings

Minority shareholders in First Mutual Holdings Limited (FMHL) will have to wait longer for CBZ Holdings Limited’s (CBZHL) mandatory offer to purchase their shares.

The offer, required by Zimbabwe Stock Exchange (ZSE) regulations following CBZHL’s acquisition of a controlling stake in FMHL from the National Social Security Authority (NSSA), in September 2023, remains pending.

CBZHL has secured a further extension from the ZSE, until November 30, 2024, to publish the mandatory offer. The delay stems from the Competition and Tariff Commission’s (CTC) ongoing review of the transaction to ensure compliance with competition laws.

The CTC expects to finalise its assessment by the end of November 2024. Once approved, the offer will be submitted to the ZSE for review.

In the meantime, CBZHL has advised FMHL minority shareholders to exercise caution when trading their shares.

“Further to the Notices to Shareholders of First Mutual Holdings Limited (‘FMHL’) issued by CBZ Holdings Limited (“CBZHL”) on 19 April 2024 and 15 July 2024 relating to the Mandatory Offer in accordance with the Zimbabwe Stock Exchange Listing Requirements and the Companies and Other Business Entities Act (Chapter 24:31), shareholders are advised that CBZHL has engaged the Zimbabwe Stock Exchange (‘ZSE’) for a further extension of the time within which CBZHL ought to make a Mandatory Offer to the remaining shareholders of FMHL because the Competition and Tariff Commission (‘CTC’) has not yet finalised its assessment of the transaction.

“At this stage the CTC has communicated to the ZSE that it expects that its Board would have made the final decision on the transaction in terms of the Competition Act (Chapter 14:28) by end of November 2024.

“The ZSE has therefore granted CBZHL a further dispensation up to 30 November 2024 within which a mandatory offer must be made to the remaining shareholders of FMHL,” Rumbidzayi Angeline Jakanani, Group Chief Governance Officer told shareholders in a notice on Monday.

The mandatory offer is a regulatory requirement following CBZHL’s acquisition of a controlling stake in FMHL. The offer’s publication hinges on securing approvals from both the CTC and the ZSE.

Shareholders will be notified once the offer is published, and CBZHL will provide further guidance on the process.