Zimre seeks to regain total control of ZPI

Harare Bureau

LISTED diversified financial services group, Zimre Holdings Limited (ZHL), has tabled share purchase agreements with shareholders of Fidelity Life and Zimre Property Investments (ZPI) in a move that will give the group total control of the two firms.

This is expected to boost ZHL’s asset base. According to ZHL, the group has entered into a share purchase agreement with the National Social Security Authority (NSSA) for the purchase of a majority stake in Fidelity Life Assurance, which will see ZHL re-integrate with Fidelity’s operations, which it unbundled in 2003.

The deal entails that ZHL purchases NSSA’s 35,09 percent stake in Fidelity. ZHL already holds 20,57 percent of the life insurer and the acquisition will see it become the majority shareholder in the company with a 55,66 percent stake.

If successful, the transaction will result in Fidelity becoming a subsidiary of ZHL and its operations being consolidated in the financial statements of the group.

According to the group, the acquisition will be done through a share swap agreement where NSSA will be issued with 65,14 million authorised but unissued ZHL shares on the basis of one ZHL ordinary share for every 0,59 FLA shares held by NSSA.

The FLA acquisition shares constitute 4,25 percent of the ZHL total issued ordinary shares.

Fidelity operates three insurance businesses, Fidelity Life Assurance, Vanguard Life Assurance and Fidelity Funeral Services. It also has several other subsidiaries involved in the provision of microlending, medical aid, asset management, actuarial services as well as property development. The company has been struggling for capitalisation as it reels under the strain of huge operating costs.

ZHL is also seeking to acquire the entire shareholding in ZPI under a two-pronged approach.

The two phased approach will entail the acquisition of the remaining shares held by minority shareholders through an open market offer and the simultaneous application for the delisting of ZPI.

“Delisting of ZPI will ease the restructuring of the business composition, enabling a leaner and more focused business structure,” said the group.