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Business Reporter
Zimplow Holdings says it is negotiating for a potential transaction that will result in disposal of more non-core assets as the group seeks to focus on primary business.
Zimplow manufactures and markets a diverse range of products for the construction, infrastructure and agricultural sectors in Zimbabwe.
It also manufactures and distributes metal fasteners for the mining, construction and agricultural sector, and has interests in property management and leasing.
Charles Chaibva, the group’s company secretary said in a statement that if successful the transaction would impact the price of the company’s securities.
“Further to the cautionary announcement issued by the board on 19 January 2022, the directors of Zimplow Holdings Limited, advise shareholders that Zimplow Holdings Limited is in negotiations for a potential transaction involving the disposal of an asset, which if successfully concluded, may have an impact on the price of the company’s shares.
“Accordingly, shareholders are advised to exercise caution and should consult their professional advisors before dealing in the shares of the Company until a full announcement is made,” he said.
Zimplow last year completed the acquisition of Scanlink Limited and three other properties which are now 100 percent subsidiaries of the group.
Apart from Scanlink, Zimplow acquired Tredcor Zimbabwe, Birmingham Investments and a two-hectare property situated along Dagenham Road in Willowvale, Harare.
According to the group, the acquisition of Scanlink and Tredcor Zimbabwe is expected to increase market presence for Zimplow in new product categories and will add brands with existing market share and brand equity that resonate with local and international customers.
The company believes the transaction would also create a robust balance sheet through the addition of property assets.
“A strengthened balance sheet will increase the company’s ability to attract capital and pursue growth opportunities organically and through strategic acquisitions,” it said.
In its third quarter to September 30 2021, Zimplow strongly believed that the anticipated good 2021/22 agricultural season and growing infrastructure projects across the country will boost its business.
During the third quarter, the group recorded a resilient performance as volumes rose across segments albeit the challenging environment due to the effects of Covid-19.
Revenue for the period went up 45 percent while profitability rose 61 percent compared to the same period in the prior year.
On a year to date basis, revenue and profitability were ahead of prior year by 62 percent and 61 percent respectively.
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