Board changes loom at Dawn

percent to influence the dynamics of the board at Dawn.
The block, totalling 221,2 million shares, sailed through on the ZSE at a 60 percent premium at US1,2c in trades worth about US$2,7 million. The deal has been linked to the potentially explosive legal battle between African Sun shareholders and the property firm.

Dawn yesterday issued a cautionary statement, advising shareholders that the legal proceedings seeking the eviction of African Sun from eight of their hotel properties had begun.
The property firm applied to the High Court for the cancellation of lease agreements for hotel properties currently being leased by African Sun.

Dawn alleges that African Sun breached the lease agreement by failing to pay rent on time and within the limits provided for in the lease agreements at the end of Octob er 2009.

The cautionary statement coincides with the takeover of the 10 percent shareholding in Dawn, which analysts have linked to African Sun shareholders.
African Sun currently holds about 18 percent in Dawn and an additional 12 percent would hand them a controlling 30 percent.
Corporate analysts yesterday indicated that Dawn was supposed to have called for a shareholders’ meeting for approval, something that could have been done three months ago..

“It looks like a well-calculated deal because shares were mopped up from different fund managers and we are likely to see developments on the market in the said companies,” said one source.
“If the consortium led by Dr (Shingi) Munyeza bought the shares or his allies, they would have bought the shares at the opportune time. They would then be in a position to influence decisions in Dawn and ideally the issue is to maintain the leases.”

A fortnight ago African Sun presented its results, in which it registered about US$750 000 in profit.
African Sun chief executive Dr Munyeza told shareholders at the analysts’ briefing that a committee was set to deal with negotiations with Dawn.
It was then understood that the committee agreed on seven iut if the eight hotels.

“The legal route cannot solve value creation for Dawn,” Dr Munyeza was quoted as saying. “What we are doing is to restore shareholder value to assets and the primary reason is that for creation of value.
“I am confident that the issues would be resolved in the short to medium term.”

Boardroom changes were also effected at the group, with Mr Bhekithemba Nkomo now the new chairman, taking over from Mr Tim Chiganze.