17 August 2012

Zimbabwe: Come Clean, Murray & Roberts Told

SECURITIES Commission of Zimbabwe has directed Murray & Roberts to disclose further information on the company's new shareholders, after the sale of the firm's 47 percent stake to Zumbani Capital.

Sources familiar with the developments said this week such "disclosures" would help the market to know "exactly" how much is the shareholders' control of the firm.

"It is known that Zumbani is a consortium owned by foreigners, its chairman being Mr Paddy Zhanda and former chief executive Mr Canada Malunga," said one source. "Even if it will be done in retrospect, it is important for the market to know the composition of Zumbani."

SecZim chief executive Mr Tafadzwa Chinamo confirmed in an interview yesterday but could not give details. "Yes, it is something that we are working on . . . but right now I cannot say much," he said.

A company official, refusing to be named for professional reasons, said Murray & Roberts would soon make an announcement.

"We had some issues with SecZim pertaining to the takeover of the company by Zumbani which include the price at which the new shareholder acquired the firm," said the official. "But this has been resolved and the issue that we are now left with is further disclosure of the composition of Zumbani.

"The company (M&R) will soon be making an announcement to that effect."

Government has amended the Securities Act that would deal with adequate disclosure of the company's information, among other issues.

M&R South Africa sold its local unit to Zumbani Capital at a discount, with the consortium paying just less than US$1,5 million for the stake.

A special bargain of 99,79 million shares went through the market on May 3 this year at US1,47c per share, significantly below the prevailing price.

Next month, M&R is due to announce its full year results to June 2012.

Chief executive Mr Stewart Mangoma said in March this year the company was targeting revenue to grow by 60 percent to US$56 million in full year to June 2012 from a year earlier.

The group had an initial target of 100 percent growth, but had to cut the forecast made in September last year as confirmed contracts started late into 2012.

Mr Mangoma said the group could achieve 60 percent next year, with activity doubling again in construction. But this was entirely dependent on what would happen in the mining sector, given the indigenisation issue.

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