malvernmugadzikwa
Business Writer
Tobacco processing concern, TSL Limited, is set to acquire a controlling 52,43 percent stake in Nampak Zimbabwe for US$25 million and the offer has since been accepted.
Nampak Zimbabwe is wholly owned by Nampak Southern Africa Holdings Limited; therefore, TSL said it is now engaged in the processes to finalise and execute the sale and purchase agreement with Nampak SAHL.
“The company has commenced the process of preparing a circular to shareholders that will contain full details regarding the transaction, a notice for the extraordinary general meeting (EGM), requisite shareholder resolutions for the transaction, and other required statutory and regulatory approvals,” TSL said.
According to TSL, transactions will require shareholder approval, which will be sought at an EGM; hence, there is a need to exercise caution when dealing in the company’s securities.
TSL operates as a holding company, which comprises the auctioning of tobacco, printing and packaging, supply of inputs to agriculture, storage and distribution and services. It operates through segments such as logistics, agriculture, real estate and services.
Group revenue for the quarter to July 2024 was 13 percent ahead of last year, mainly due to the volume growth in the logistics business. About 83 percent of group revenue was generated in USD cumulatively at the end of the quarter. But the group noted that a significant crystallisation of US$ costs was noted in the quarter, resulting in US$ inflation.
In a sperate statement, Nampak Zimbabwe said the disposal remains subject to various suspensive conditions, including the conclusion of binding transaction agreements and obtaining all necessary regulatory approvals.
In terms of the Companies and Other Business Entities Act (Chapter 24:31) and the Zimbabwe Stock Exchange (ZSE) Listings Rules, the purchaser is required to make an offer to the remaining shareholders of Nampak Zimbabwe following the disposal being implemented.
“The purchaser has confirmed that it has the capacity to undertake the mandatory offer within the regulated timeframes, through settlement by either cash or by way of a share swap using its own shares.
“For the avoidance of doubt, the mandatory offer will be implemented by the purchaser independently, following the implementation of the disposal, and without any involvement of Nampak,” it said.
Nampak noted that a further announcement will be released once the binding transaction agreements have been executed, following further negotiations.
It said the rationale for the disposal is in accordance with Nampak’s asset disposal plan; the company is an asset of high value, being prioritised for disposal.
In a trading update for the quarter to June 30, 2024, Nampak Zimbabwe group volumes were 2 percent ahead of the prior year, with most of the product lines higher than last year except for high-density polyethylene (HPDE) and commercial cartons, which were affected by a slowdown in demand and increased competitor activity.
Cumulative volumes for the nine-month period to June 2024 were 3 percent below prior year due to volume recoveries in the current quarter, which have made up for the volume losses in the previous quarter, particularly in the paper cluster as well as in metals.
Bongani Ndlovu