adminBright Madera Senior Business Reporter
THE Zimbabwe Stock Exchange last year recorded 75 special bargain deals valued at about US$101 million, the highest since dollarisation.
A special bargain deal, in an equities market, is where shares are acquired for higher or lower than their market value. The special price is negotiated between the buyer and the seller.
The frequency of the deals recorded and the high premiums paid for some of them were queried by the Securities Commission of Zimbabwe.
The commission described them as way outside the market range. But since they were special bargains, such transactions will always sail through in a depressed market.
Mobile phone operator Econet Wireless and beverages maker Delta Corporation – the biggest companies on the bourse by market capitalisation – topped in both the number and value of deals.
Econet recorded 12 special bargain deals during the 12 months, valued at US$21,3 million. Delta managed eight deals valued at US$13,2 million.
Thirty companies recorded the 75 transactions involving 1,1 billion shares. The ZSE has 77 counters of which three are suspended.
During the period under review, National Foods Limited recorded the biggest deal of the year as Tiger Brands of South Africa secured a 12,3 percent stake in the firm, paying 82, 50 percent premium.
Innscor Africa Limited held the shares.
A total of 8 021 779 shares went through as a special bargain at US146c in a deal worth US$11,7 million while normal trades went through at US80c.
Natfoods has only 64 004 108 shares listed, the bulk of which are controlled by Innscor and the South African food processing and packaging giant.
The deal lifted the day’s turnover to US$13 million, up from US$1,1 million recorded the previous day while 15,9 million shares changed hands.
Tobacco processors TSL also recorded another major deal on the market when Closefin Investments, a consortium of local businessmen, raised its shareholding in the firm to 58,8 percent after acquiring a significant 29,7 percent stake from Tetrad-linked investments in the group.
The consortium paid US$11,3 million for 102,7 million shares at a bargain price of US11c, representing a 38 percent premium. TSL traded at US8c in normal trades at the consummation of the deal.
Meanwhile, very few deals outside special bargains were recorded on the market with the exception of a block of 42 million Aico Africa shares worth US$10 million, which changed hands at US24c through a cross-over.
A book over is a deal between buyer and seller but at the prevailing market price.
However, the increase in the number of special bargain deals failed to give impetus to the market, which closed the year in negative territory.
Online Reporter