Multinational investment firm, Cambria Africa has conditionally agreed to sell its 78,2% shareholding in AF Philips (Pvt) Ltd for US$1,74 million in cash, Standardbusiness has established.
Cambria, whose investments in Zimbabwe include the Payserv Group and Millchem, revealed in an investment update that it will continue maximising the realisable value of its net asset value (Nav) at the holding level.
“The company has conditionally agreed to sell its 78,2% shareholding in AF Philips (Pvt) Ltd (AFP) for a sum of US$1,74 million in cash,” Cambria revealed in its update.
“This amount is equivalent to the book value of its shareholding in AFP at August 31, 2022 and at that level of in each of the company's published results for the year ended August 31, 2021 and six months ended February 28, 2022.
“The company made its initial investment in August 2018, and through the holding, has an effective 9,74% interest in a property development and bricks manufacturing business.”
Cambria revealed that the sale is subject to precedent conditions, which the company has reasonable cause to believe will be met and that the full purchase price will be realised at the holding level.
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“The company will provide a further update once the sale has completed,” it said.
Cambria said the Zimbabwe’s Finance ministry has released US$75 642 in part settlement of US$957 642 of legacy debt or blocked funds and deposited the money with the Reserve Bank of Zimbabwe.
The company said it expects at least US$100 000 with respect to US$416 396, 22 of legacy debt registered by Gardoserve, a group company.
The legacy debt total of US$1,39 million was deposited with the central bank in 2019 at parity to the US dollar, it said.
Its value in Cambria’s Nav on August 31, 2022 at the official exchange rate of $547 was the equivalent of US$2 545.67, the company said.
“Therefore, the vast majority of any recovery will impact the company's Nav and profitability positively,” Cambria said.
“In the view of the board these repayments bode well for the possibility of recovering the full value of the company’s legacy debt or blocked funds.”
The company said Old Mutual shares remained suspended on the Zimbabwe Stock Exchange (ZSE) as well as their fungibility, which prevented it from repatriating these shares to the Johannesburg Stock Exchange (JSE) where they were purchased and transferred to the ZSE before fungibility and trading was halted.
“The company and other holders of Old Mutual shares in Zimbabwe have not been privy to developments in negotiations between the directors of Old Mutual Zimbabwe and government of Zimbabwe,” it said.
Cambria said the US dollar value of its 204 047 shares has fallen to US$113 000 based on the JSE closing price on October 21, 2022 compared to the value of US$163 342 on the JSE on May 27, 2022 when the interim results for the six months ending February 28, 2022 were announced.
The company said Old Mutual’s inability to protect the rights of its shareholders in Zimbabwe to trade their shares on a recognised exchange has significantly prejudiced its investment in Old Mutual shares.