Online Reporter
Nelson Gahadza
Business Reporter
Khayah Cement Limited, one of the leading cement manufacturers in the country, plans to delist from the Zimbabwe Stock Exchange (ZSE) as part of a strategic restructuring to stabilise its operations following the company’s voluntary placement under corporate rescue on December 24, 2024.
The company, in a circular, said the delisting decision followed careful consideration by the corporate rescue practitioner in consultation with financial advisors and has been determined to be in the best interests of the company and its stakeholders.
“The decision has been taken to facilitate the resuscitation of the company by developing and implementing a rescue plan aimed at restructuring its affairs, business, property, debt, and other liabilities,” reads part of the circular.
According to the circular, the rationale of the proposed delisting includes stabilisation and recovery, with the delisting being a strategic step to stabilise the company and ensure its long-term recovery.
The company also said it is unable to meet certain listing requirements and costs associated with the listing, including but not limited to submitting timely financial reports and listing fees, hence, delisting will result in regulatory compliance.
“Delisting will also allow the company to focus on critical restructuring tasks without public market scrutiny,” reads the circular.
Khayah said the delisting also enabled confidential and efficient implementation of essential measures, such as debt negotiations, cost-cutting initiatives and asset rationalisation.
Also, as part of the rationale for delisting, the company believes terminating the listing reduces costs associated with maintaining a public listing, freeing up resources for recovery efforts.
“The company’s shares face prolonged uncertainty and illiquidity; voluntary delisting resolves this limbo, protects shareholder interests during restructuring, and allows focused recovery efforts to stabilise operations. Delisting is not an endpoint but a strategic pause to enable recovery,” reads part of the circular.
Khayah boasts over 70 years of operational experience, which has positioned it as a key player in the cement manufacturing industry, supporting infrastructure development and economic growth through its diverse product offerings.
The company operates a single manufacturing facility, the Manresa Cement Plant in Harare, with a production capacity of 700 000 tonnes annually. Khayah also operates a Dry Mortar Division (DMO), producing tile adhesives, grouts, agricultural lime, and specialised waterproofing solutions.
The DMO runs an automated and a manual plant, which are designed to process a mixture of products with a combined capacity of 100 000 tonnes annually.
However, the shutdown of its kiln in 2023 forced the company to adopt a grinding station model, relying on expensive imported clinkers, which increased production costs.
Unanticipated breakdowns of critical equipment, including the Vertical Cement Mill, further affected profitability.
Last year, an influx of lower-priced imported cement, particularly from Zambia, resulted in the company being unable to compete due to high production costs, resulting in low sales volumes and revenue.
However, Khayah has undertaken cost-containment measures, including staff rationalisation, and is negotiating financing for kiln refurbishment, with recommissioning expected in the first half of 2025.
