BridgeFort Capital, formerly Medtech Holdings, is set to migrate its Class A and Class B listings to the Victoria Falls Stock Exchange (VFEX) and list by way of introduction.
The group, listed on the Zimbabwe Stock Exchange (ZSE), classifies its businesses into class A and class B portfolios.
Class A portfolio is made up of consumer goods and primarily includes 50,1 percent of Zvemvura Trading (Private) Limited, trading as MedTech Distribution, and Chicago Cosmetics (Private) Limited, a 51 percent subsidiary of MedTech Distribution.
The company's Class B portfolio (property) is the only asset within this portfolio in the form of bank and cash balances of US$120 000.
Bridgefort, in a circular to shareholders, said its board had approved the termination and the subsequent listing of its shares on VFEX pending shareholder and other regulatory approvals.
"Benefits of the proposed transactions include, but are not limited to, access to a growing fintech, funeral services, funeral assurance and financial services portfolio, enhanced ability to attract capital inflows into Zimbabwe, a broader investor base, and access to USD capital," reads the circular.
The company added that it would also enable it to present its financial reporting in US dollars and access lower foreign exchange risk for shareholders.
VFEX, a US dollar-denominated stock exchange, is increasingly becoming the preferred stock exchange as it continues to evolve through new listings and new product development.
Since its inception in October 2020, VFEX has attracted listings from various sectors such as mining, financial services, tourism, hospitality, and clothing.
According to the circular, the VFEX listing will be preceded by the issue of 83 440 639 BridgeFort Capital Class A preferred shares to Diaspora Kapita shareholders along with various parties owed sums of money by Diaspora Kapita and its subsidiary or associated companies.
After the allotment, the company shall own 100 percent of Diaspora Kapita, who in turn will own 74,12 percent of NAFUICO, 100 percent of Tsigiro Usekelo, and other investments.
The transaction will also involve the issue of 2 486 599 Class A preferred shares to various holders of claims against AgroStrong, which will be converted to equity in AgroStrong such that after the conversion to equity, BridgeFort will own 99,94 percent of AgroStrong and Diaspora Kapita will own the balance.
The allotment of 84 615 385 Class A preferred shares to the placement agent to unlock capital for the Class A portfolio as and when required and the split of each of the ordinary shares in issue into 0,15 ordinary shares and 68,69883 Class A preferred shares for the 100 000 ordinary shares currently in issue.
"This will be immediately followed by the subscription by certain of the current Diaspora Kapita key shareholders for 85 000 ordinary shares for the total sum of US$ 850 00 and the allotment of 55 555 556 Class B Preferred Shares to the Placement Agent to unlock capital to execute the Class B Portfolio strategy as and when property acquisition or investment opportunities arise," reads the circular.
Diaspora Kapita, established in 2014 in South Africa, is a collaborative venture between Zimbabweans living in the diaspora and their counterparts in Zimbabwe.
The group provides a range of services and investment opportunities tailored to the diaspora community.
These include comprehensive funeral services, which cover funeral arrangements, burials in South Africa, and repatriations to Zimbabwe.
Brdigefort said the listing on the VFEX and the conclusion of the proposed transactions were subject to other key conditions, such as obtaining exchange control approval from the Reserve Bank of Zimbabwe (RBZ) and the South African Reserve Bank (SARB) for the conclusion of the proposed transactions.
It also requires approval of the VFEX listings committee for the listing of BridgeFort Class A and B preferred shares on the VFEX.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
The company's Class A portfolio is primarily a distributor of consumer goods manufactured by Amka Products in South Africa and Chicago Cosmetics.
The products include personal and hair care lines such as Satiskin, Clere, Shower to Shower, Easy Waves, Jabu Stone, Sofn'Free, and Top Society, and the main customers are supermarkets and wholesalers.
Chicago Cosmetics manufactures several of the higher volume lines, with lower value line's sold by MedTech Distribution.
"These businesses have suffered extensively from the devaluation of the local currency over the past several years due to local currency debtors, which have been inadequately hedged.
"The traditional retail and wholesale channels are now buying a fraction of their previous volumes as they and the rest of the formal economy struggle to compete with the booming informal sector," the company said.
