We erred on suspension of Meikles: ZSE Meikles given March 2 as response deadline Meikles Departmental Store in Bulawayo
Meikles Departmental Store in Bulawayo

Meikles Departmental Store in Bulawayo

THE Zimbabwe Stock Exchange has made a clean breast regarding last week’s suspension of hotel group Meikles’ shares from trading on the bourse, saying it had not engaged the affected party.

Yesterday’s lifting of the suspension came just in time to efface court action by Meikles over the suspension.

Meikles was suspended last week to allow for an investigation on whether it overstated a debt owed by the Reserve Bank of Zimbabwe.

The local bourse argued that Meikles reported in its 2014 full year results that it was owed $90,8 million by the central bank, compared with $40,51 million that had been owed in 2013, without giving an explanation for the sharp increase.

Yesterday the ZSE said the suspension of Meikles was made without the consultation of the latter, but that the move had been approved by the Securities and Exchange Commission of Zimbabwe.

“The decision to reverse the temporary suspension was necessitated by the fact that Meikles Limited was not given an opportunity to make representations in terms of Section 111 of the Securities and Exchange Act [Cap24.25] and Paragraph 1.5 of the ZSE Listings Requirements prior to the temporary suspension on 16 February 2015.

“The temporary suspension and its lifting were approved by the Securities and Exchange Commission of Zimbabwe pursuant to Section 64 of the Securities and Exchange Act [Cap24.25],” said the bourse.

ZSE said it had engaged Meikles “separately” over the matter and expects a response by Monday next week.

“The ZSE has written to Meikles Limited in relation to matters that are of concern to the ZSE primarily related to the carrying amount of the “balances with the Reserve Bank of Zimbabwe” as well as the possible financial impact and certain matters that have recently come in the public domain pertaining to matters that may have a material impact on the soundness and accuracy of the 2014 financial statements.

“We’ve addressed Meikles Limited separately and given them until 1630 hours on Monday, 2 March 2015 to respond to the specific issues.”

The RBZ debt schedule gazetted last August shows that Meikles was owed $40.64 million as at September 30 2013. This was after accounting for 4.68 percent interest on the original amount owed of $24.88 million.

In 2011 after the October 2010 demerger with Kingdom Financial Holdings the group recorded balances held by the RBZ as $36.82 million from the unaudited restated 2009 January 1 amount of $35 million.

In 2012 the amount was at $38.62 million and then rose to $40.51 million in 2013.

However, last year, the group recorded the balance as $90.8 million, a 124.14 percent increase from the prior year’s amount.

Meikles said the increase in the amount was as a result of interest negotiations, which are based on lending rates. — Harare Bureau/BH24.

 

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