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Acting Business Editor
THE demutualisation of the Zimbabwe Stock Exchange (ZSE) is expected to be completed in the first quarter of next year following the recent appointment of technical advisors to spearhead the process. Demutualisation refers to a process by which a mutual organisation is transformed into a publicly traded firm.
The process (demutualisation) has been on the cards for several years with Government saying lack of funding was hindering the process that is expected to increase the value of shares.
Government wants the ZSE to be transformed from being a member-owned organisation into a company with shareholders and directors to improve on corporate governance.
At present, the bourse is being run by stockbrokers who are responsible for all its operations.
However, when demutualised, the ZSE would be listed on the bourse and have shareholders, directors and management responsible for various aspects of the company.
“The Exchange is expected to be demutualised by end of the first quarter in 2014 and this should improve corporate governance on the ZSE through separation of management, ownership and participation,” said Finance and Economic Development Minister Patrick Chinamasa.
He added that ZSE had also put in place a framework for the establishment of an Automated Trading System that will complement the proposed Central Securities Depository.
It is hoped that by the second quarter of 2014, the trading platform of the stock exchange would have been automated.
Automation of the ZSE would see a sharp rise in daily trades. So far, the local bourse trades an average of $1 million a day and if automated daily would increase to between $5 million and $6 million a day.
Meanwhile, the number of de-listings and suspensions on the ZSE this year has been on an upward trend largely due to viability challenges by listed entities.
Since the beginning of the year, 10 counters were de-listed while five were suspended.
Online Reporter