ZIMBABWE – Seed Co International (SCIL), a leading certified seed company operating in over 15 African countries has announced the migration of its secondary listing from the Zimbabwe Stock Exchange (ZSE) to the newly formed Victoria Falls Stock Exchange (VFEX).
Becoming the first company to be listed on Zimbabwe’s new foreign currency denominated bourse, the fungibility of SCIL’s share remain suspended.
The company revealed in a statement that it is waiting for further announcement regarding trading modalities between the VFEX and stock exchange outside Zimbabwe, including the Botswana Stock Exchange where it has its primary listing.
VFEX is a wholly-owned subsidiary of the Zimbabwe Stock Exchange (ZSE) and will trade solely in foreign currency targeting companies in Zimbabwe and the Africa continent, before expanding across the globe.
“The proposal to merge the Zimbabwean operations held under Seed Co Limited and the international operations, held under Seed Co Limited is still being pursued and relevant regulatory approvals are being sought.”E.M. Kalaote, Seed Co Group Secretary
The establishment of the platform follows the Ministry of Finance and Economic Development of the Republic of Zimbabwe undertaking investigations relating to alleged participation in parallel foreign currency market activities by dual-listed companies in Zimbabwe.
The investigations noted that implied exchange rates were being derived from the comparison of dual listed share prices on the ZSE and other exchanges, and such implied rates were believed to be the leading indicators of speculative parallel foreign exchange rates in Zimbabwe.
In a bid to provide a permanent solution to the situation, the ZSE in consultation with the Ministry of Finance and Economic Development, established a subsidiary, the VFEX where dual-listed companies would be allowed to list their shares for trading in foreign currency.
To strengthen SCIL’s listing on VFEX, it has proposed to merger with its Zimbabwean operations, Seed Co Limited.
“The proposal to merge the Zimbabwean operations held under Seed Co Limited and the international operations, held under Seed Co Limited is still being pursued and relevant regulatory approvals are being sought,” said E.M. Kalaote, Seed Co Group Secretary.
Seed Co International this year celebrates its 80th year anniversary having been formed in 1940 as Seed Maize Association (SMA).
In 1957 the company build the Crop Seeds Association (CSA) to later merge SMA and CSA in 1983 forming Seed Co-op.
The company has registered operations in Botswana, Ghana, Kenya, Malawi, Nigeria, Rwanda, South Africa, Tanzania, Zambia and Zimbabwe.
In addition, its products are distributed in DRC, Ethiopia, Lesotho, Swaziland and Uganda.
According to the group’s full year results to 31 March 2020, its turnover rose by 19% to US$71m while operating profit of US$12m and Profit before tax of US$9m both increased by 74% as compared to prior year.
The performance during the period under review was boosted by the increased seed demand in the region after the severe drought experienced last year.
In addition, exchange gains on foreign denominated receivables contributed positively to the financial performance for the year.
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