ZSE presses ahead with plans to self-list
THE Zimbabwe Stock Exchange (ZSE) has announced progressive discussions with relevant regulatory authorities regarding its scheme of reconstruction, which will, among other things, culminate in its self-listing on the ZSE main board.
At an extraordinary general meeting held on 9 October 2024, shareholders unanimously agreed to the transaction in which Zimbabwe Stock Exchange Holdings Limited (ZSE Holdings), a newly incorporated entity, will make a buy-out offer to the shareholders of the ZSE. They will be settled pari passu at an exchange ratio of “one” ZSE Limited Ordinary share for “one” ZSE Holdings Ordinary share.
According to the ZSE, the reconstruction will significantly alter the corporate structure and governance of both entities.
In a statement to shareholders, the ZSE said that since positive outcomes from these discussions are anticipated, the company is already in the process of compiling a pre-listing statement.
“Shareholders are advised that there have been progressive discussions between the company and the relevant regulatory authorities regarding obtaining regulatory approvals. These are from the Zimbabwe Revenue Authority (Zimra) in respect of the Scheme of Reconstruction and the Securities and Exchange Commission of Zimbabwe (SecZim) in terms of amendments to the Self-Listing Rules (Statutory Instrument 147 of 2024), for which positive outcomes are expected in the near future,” the ZSE said.
The company added that it is already in the process of compiling a pre-listing statement in respect of its proposed listing, the publication of which will be triggered by the aforementioned regulatory approvals.
“Shareholders will therefore be provided with regular updates on progress as regards the fulfilment of any conditions precedent, prior to the release of the Pre-Listing Statement,” the ZSE said.
According to the ZSE, the primary goal of the scheme of reconstruction is to streamline operations, improve liquidity, and unlock shareholder value through the creation of a more robust corporate entity. Following the transaction, the shareholders of ZSE Limited will receive the entire issued ordinary shares of ZSE Holdings.
“The purpose of incorporating ZSE Holdings Limited was to create a listable holding company that would control a collapsed existing structure of ZSE Limited,” the ZSE said in an earlier circular, adding that this reorganisation will enable a smooth transfer of shareholding from ZSE Limited and VFEX to ZSE Holdings.
The operations of both the ZSE and VFEX will remain independent due to separate securities exchange licences.
The two entities will operate under ZSE Holdings, facilitating the introduction of new products and services while maintaining regulatory compliance.
The ZSE is also urging its shareholders to submit their share certificates for the dematerialisation process, which is part of preparations for the listing of ZSE Limited on the stock exchange.
Dematerialisation is the process of converting physical securities into electronic or digital form, and the ZSE Depository has been actively promoting the switch from physical certificates to electronic holdings.
The ZSE is also working on a number of initiatives that include reducing the settlement cycle to T+2.
In its recent newsletter for the first quarter of 2025, the ZSE said that as of 31 March 2025, market tests for the T+2 settlement cycle had been completed and approval had been granted by SecZim to proceed with the implementation. T+2 is expected to go live in April 2025.
A reduced settlement cycle will result in a reduction in the number of days between trade execution and settlement, which will reduce counter-party, market, operational, and credit risk across the settlement ecosystem, especially during periods of market volatility.
Investors will also benefit from earlier receipt of their funds, thus reducing the risk of loss of value due to adverse macroeconomic movements, and faster settlements will enhance investor confidence in the market.
-chroncile
