ZIMBABWE – Zimbabwean maker of farm implements, Zimplow Limited is seeking to acquire the entire issued share capital of Scanlink Limited, Tredcor Zimbabwe Limited, Birmingham Investments Limited and Stand 30001 Dagenham Road, a new property in Harare’s Willowvale Township.
The negotiated value of the acquisition for the companies and proposed property will be settled via an issuance of 106, 199, 706 new Zimplow ordinary shares that are listed on the Zimbabwe Stock Exchange, reports Zimbabwe Standard.
“On successful completion of the transaction, Scanlink, Tredcor Zimbabwe and Birmingham Investments will become wholly owned subsidiaries of ZIMW and ZIMW will also become the owner of the target property.”Zimplow chairman – Thomas Chataika
The expenses of the transaction, amounting to approximately ZWL$7.44m which relate to legal, transfer secretaries, advisory fees, various printing, distribution, regulatory fees and such other charges, will be paid by Zimplow, indicated the company.
“On successful completion of the transaction, Scanlink, Tredcor Zimbabwe and Birmingham Investments will become wholly owned subsidiaries of ZIMW and ZIMW will also become the owner of the target property. Zimplow will remain listed on the Zimbabwe Stock Exchange,” Zimplow chairman Thomas Chataika said.
Over the years Zimplow has constructed a portfolio of complementary businesses and brands focused on manufacturing and distributing farming, mining and construction industry implements and the acquisition is aimed to enable it diversify its products and services.
Scanlink is focused on distributing large vehicles, long-range buses, coaches and generators with the main customers being in the mining industry.
On the other hand, Tredcor Zimbabwe is focused on the distribution of Goodyear tyres and the re-treading of a variety of brands.
Zimplow says the two businesses are complementary to its existing portfolio which entrench the company’s market position in the mining and construction industries.
“Additionally, the acquisitions will provide the company with increased product diversity and market share in the transport and logistics industry,” Chataika said.
Birmingham Investments is a foreign currency revenue generator and owns Birmingham Property (Private) Limited which has an immovable property known as 63/65 Birmingham Road, Southerton, Harare.
While the proposed property is currently vacant, when it was previously leased by a tenant a monthly rental of US$10, 350 or US$124, 200 annually was paid.
An extraordinary general meeting (EGM) will be held on October 15 where Zimplow shareholders will vote on whether to proceed with the offer with the results of the EGM being released on the following day.
In its trading update for the first quarter ended March 31, 2020, Zimplow reported having increased its revenue by 896% over the 2019 comparative period while profit after tax was also ahead by 1 111% compared to 2019.
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