RTG seeks to acquire complementary business
Business Writer
Rainbow Tourism Group (RTG) has indicated that it is still engaged in negotiations for a potential acquisition of a yet-to-be-named complementary business.
Last week, the firm issued its fourth cautionary statement to shareholders that the acquisition process is ongoing.
“Further to the cautionary statements published on the 6th and 27th of July and 24th of August 2023, the board of directors of Rainbow Tourism Group Limited wishes to advise all stakeholders and the investing public that the company remains engaged in negotiations for an acquisition of a complementary business to the company’s operations,” reads part of the statement.
It noted that if successfully concluded, the transaction may have a material effect on the price of the company’s securities.
Recently, the group said it is considering expanding its hotel portfolio in carefully selected areas around the country as part of elaborate efforts to increase value for its shareholders.
Added to that, the listed hotel entity is also focusing on expanding it’s reach in the tourism value chain through investment in tour operations and Heritage Expeditions Africa.
Meanwhile, last week two financial institutions CBZ Holdings, the country’s leading financial products and service provider and ZB Financial Holdings issued separate 11th additional cautionary statements on potential acquisitions.
Both entities said they are still engaged in negotiations for a potential acquisition of a complementary business.
“Further to the Cautionary Announcements issued on 20 June 2022, 22 July 2022, 31 August 2022, 30 September 2022, 17 November 2022, 23 January 2023, 03 March 2023, 13 April 2023, 7 June 2023, and 28 July 2023 shareholders are advised that negotiations with one of the shareholders are still ongoing for a potential acquisition of a control block of securities, which if concluded successfully may have a material effect on the company’s securities price,” reads part of ZB Holdings statement.
The CBZ transaction is believed to be the acquisition of ZB Financial Holdings in its quest to build a bigger bank, but ZBFH is in a wrangle with a shareholder of its subsidiary.
This comes as ZB Holdings is trying to merge its bank with the ZB Building Society to meet the minimum regulatory capital as prescribed by the Reserve Bank of Zimbabwe for the subsidiary.
It is a regulatory requirement for a banking license.
Banking institutions are required to have a minimum capital of US$ 30 million and building societies or mortgage lenders are required to have minimum capital of US$ 20 million.
ZB proposed to merge its banking division with its mortgage lending unit to meet the minimum capital requirement.
That effort, however, hit a snag because of an ongoing shareholder wrangle between an investment vehicle belonging to veteran banker Mr Nicholas Vingirai called Transnational Holdings Limited, which has a direct holding in Intermarket Holdings Limited which subsequently controls the building society or mortgage lender and ZB Financial Holdings.
Mr Vingirai, through Transnational Holdings Limited, insists that the merger between the bank and the building society/mortgage lender can only take place once the Government of Zimbabwe brokered resolution between Transnational and ZB Financial Holdings over what he called the scandalous and fraudulent acquisition of Intermarket by ZB Financial Holdings.
The dispute between the two parties is longstanding and began as far back as 2006.
ZB Financial Holdings comprises assets that belong to Transnational Holdings Limited. For the assets that were annexed from Mr Vingirai, Government duly transferred 22,7 percent of the shares in ZB Financial Holdings to the veteran banker.
More shares are due to Mr Vingirai’s investment vehicle so that they correspond to the value of Intermarket Holdings at the time that the Government took it over.
In July 2021, 11 percent of ZB Financial Holdings shares were supposed to be transferred to Transnational Holdings Limited.
The dispute has been long drawn out with all kinds of proposals being made ranging from demerging Intermarket from ZB to allocating shares to the veteran banker.
Comments