admin
Business Reporter
AGRI-BUSINESS concern Interfresh plans to delist from the Zimbabwe Stock Exchange because it feels its shares are grossly undervalued and frustrating efforts to raise fresh capital.
If shareholders approve a proposal from the directors, the company will stop trading on the ZSE on 31 December. An Extra-ordinary General Meeting to vote on the matter will be held on 11 December.
Interfresh was incorporated in 1953 and listed on the ZSE in 1997.
In a statement, the company chairperson Ms Chipo Mtasa said delisting would enable it to source funding at a reasonable valuation of its assets.
As of Monday with its shares trading at 1,50 cents, Interfresh had a market capitalisation of $2,981 million.
In July, the company sought to raise $3 million through a rights offer but only 57,53 percent of shareholders followed through their rights. The company linked the poor performance of the rights offer to the undervaluation of its shares.
“The company’s shares have consistently traded at a significant discount to net asset value of the company and indeed other valuation methods. Raising capital at current valuation has proved limiting.
“The company needs to raise equity capital and convertible debt from private equity and structured finance markets using valuation methods other than the stock market,” said Ms Mtasa.
She said if Interfresh operated as an unlisted company, it would be able to raise $6 million through equity and structured funding.
“It is the considered opinion of the directors that delisting facilitates access to funding from private equity and structured finance markets at reasonable valuations and that the much needed funding so raised would be effectively applied to stabilise and grow the company,” said Ms Mtasa.
However, she said the company would consider relisting on the bourse in the medium term.
Interfresh is a diversified agri-business company which produces, processes and markets agricultural produce for local and foreign markets.
It has several divisions including citrus, crops, beverages, and fast moving consumer goods.
Three companies have so far delisted from the ZSE this year which has 64 active counters.
Online Reporter