eBusiness Weekly
Golden Sibanda
The Zimbabwe Stock Exchange (ZSE) says listed agro-focused group CFI Holdings, has not yet rectified breaches of listing requirements that caused suspension of trading in its stock, but the exchange remains hopeful the matter will be resolved soon.
Trading in CFI shares was suspended indefinitely last month following expiry of a second three month suspension of the shares from ZSE in June with the group failing to resolve free float shareholding and corporate governance deficiencies raised by the ZSE.
ZSE Acting chief executive Martin Matanda, told Business Weekly this week that the bourse was still trying to engage the company, but to date there had been no progress in efforts to have anomalies corrected.
The exchange first suspended trading in CFI Holdings’ shares in January this year for three months, but extended the suspension by an additional three months after the company failed to address the ZSE’s demands following the lapse of the initial suspension.
“We are still trying to engage the client, nothing has taken place thus far and we are hopeful that the matter will be resolved. The shares have been suspended indefinitely,” he said.
CFI shares were suspended from trading on ZSE after it failed to comply with free float requirements as per Section 4 paragraph 4.25 (d) of the ZSE listing requirements.
While listed entities are compelled to have at least 30 percent of their outstanding ordinary shares freely traded on the bourse, CFI’s two major shareholders Stalap and Messina Investments now own about 42 percent of the agro-industrial’s group’s shares each.
Citing a notice first issued by the ZSE dated 2 June 2018 on the suspension from trading of CFI Holdings the exchange advised that the suspension period had been prolonged indefinitely and will be lifted after all identified breaches have been regularized.
In the update statement released last month Mr Matanda said that the “ZSE sought and was granted permission to further suspend trading in CFI Holdings Limited’s shares by the Securities and Exchange Commission of Zimbabwe (SECZIM) pursuant to the provisions of Section 64 (1) (a) (ii) of the Securities and Exchange Act [Cap 24:25].”
“In terms of Section 1 paragraph 1.8 of the ZSE Listings Requirements, the company should continue to discharge its obligation to the Shareholders and the Zimbabwe Stock Exchange during the suspension.
CFI Holdings has also been requested to address governance related matters regarding the appointment of a substantive board chair, chief executive officer and finance director.
Further, the agro industrial is required to appoint independent non-executive directors who are not affiliated to or have any association with the company’s directors.
However, it remains to be seen whether CFI major shareholder Van Hoogstraten keen on complying with the ZSE directive given he is on record saying a permanent exit from the ZSE was possible as the company’s assets had been pillaged under its watch.
Van Hoogstraten accuses the ZSE OF biased in the way it handled irregularities pertaining to the manner in which CFI was being run before he acquired swaying influence in the firm.
