TEA producer, Tanganda Tea Company Limited, is finalising a circular detailing a planned secondary listing on the Victoria Falls Stock Exchange (VFEX) and a US$8 million capital raising plan.
In October 2024 last year, Tanganda’s board of directors announced they would meet to discuss delisting from the Zimbabwe Stock Exchange (ZSE) for a VFEX listing. It later ditched the plan.
Instead, the board agreed to issue new shares and list on the VFEX while maintaining its ZSE listing.
“Further to the cautionary announcement dated December 31 2024, the directors of Tanganda Tea Company Limited wish to advise shareholders and the investing public that the company is currently finalising the preparation of a circular to shareholders,” Tanganda said in a statement yesterday. According to the tea producer, the circular will contain details of the interrelated transactions and will also include a notice to convene an extraordinary general meeting of members to consider and approve the transactions.
These include the proposed creation of a new class of shares to be known as Class A ordinary shares, which will be subsequently listed on the VFEX as a secondary listing and a renounceable rights offer of the listed Class A ordinary shares to the existing ordinary shareholders in proportion to their shareholding in the company to raise US$8 million.
When Tanganda listed on the ZSE on February 3, 2022, it had a market capitalisation equivalent to US$134,29 million.
Keep Reading
- ‘Zim has capacity to produce 12 tonnes macadamia nuts per hectare’
- Tanganda revenue surges 48%
- Tanganda lines up value addition projects
- Tanganda profit up 25% on costs cuts
However, Tanganda’s market capitalisation was on Monday valued at US$18,17 million, meaning shareholder value worth more than US$110 million had been lost.
“The directors will continue to assess the impact of the volatile economic environment on the company’s operational and financial performance.
This will be mainly focused on continuous assessment of exchange rate volatility, its impact on suppliers, employees, lenders and other stakeholders, as well as the impact of other micro- and macro-economic indicators,” Tanganda said, in a statement accompanying its financial results for the year ended September 30 2024.
“The directors are also looking at diversifying the markers for the company’s products.
The company’s projections show that the company has sufficient capital, liquidity and positive future performance outlook to continue meeting its short-term obligations and, as a result, it is appropriate to prepare these financial statements on a going concern basis, even considering the impact of the local economic volatility.”
These projections were prepared covering Tanganda’s future performance, capital and liquidity for a period of 12 months from the sign-off date.
Tanganda noted that demand for its products remained relatively strong despite the impact of intricate macroeconomic factors on local, regional and international markets.
“The company will continue to pursue sustainable market diversification to expand the regional and international markets,” Tanganda said.
The firm has put in place mitigation strategies to enhance process efficiencies and manage costs.
“Notwithstanding the operating environment challenges, the company remains focused on adding value to its products,” Tanganda said.
The firm had total assets worth US$35 142 959 as of September last year.