VFEX in a spectacular rebound – Bulawayo24 News
The Victoria Falls Stock Exchange (VFEX) has emerged dramatically to capture some of Zimbabwe’s biggest companies, with multinationals taking bold steps to enter the stunt last week.
Zimbabwe Stock Exchange-listed crocodile breeder (ZSE) Padenga Holdings was delisted on Friday and moved to the new stock exchange, marking a milestone in his ambition to end a listing drought in the country, where ZSE struggles to attract counters.
Padenga is one of the world’s largest suppliers of crocodile skins for luxury bags and shoes, counting the world’s leading brands among its customers.
Ahead of Padenga’s VFEX listing on Friday, New York-listed resource company Caledonia Mining Corporation, which controls the Gwanda-based Blanket mine, announced that it was moving forward with a stunt listing plan.
This will make it the third window on the exchange where SeedCo International became the first window to be listed in October of last year.
VFEX has struggled to attract counters since it started operations in October last year, but has recently received special attention from counters, including CBZ Holdings, the largest group Zimbabwe Financial Services Agency, which has also announced its intention to join the race.
Australian-listed Invictus Energy, which is undertaking the highly promising Muzarabani oil and gas project, has also expressed interest in being listed on the VFEX.
In a statement released Thursday, Caledonia CEO Steve Curtis said the listing would be subject to market conditions and the implementation of positive proposals made by Zimbabwean authorities to improve US dollar payments for gold produced at Blanket Mine.
“Securing of the listing of VFEX is expected to take place during 2021 and would be effected through a placement in Zimbabwe of certificates of deposit to raise approximately $ 3 million (to meet local shareholder allocation requirements) and subsequent IPO.
“The proceeds of the placement would be used for general corporate purposes,” Curtis said.
“I welcome the step towards a more liberal financial environment, which is reflected in the proposed benefits of a listing on the Victoria Falls Stock Exchange.”
Caledonia said the proposed VFEX listing demonstrates its continued commitment to Zimbabwe and would make it easier for its employees in Zimbabwe to participate as shareholders of the company.
The VFEX has put in place incentives such as tax breaks and the ability to repatriate funds from Zimbabwe.
Speaking to Bloomberg ahead of the listing, Lloyd Mlotshwa, head of research at Harare-based IH Securities, said Padenga’s listing marks an important step in attracting more companies.
“We see this as a first step in improving the attractiveness of VFEX by adding quality asset and generating hard currency for investors to consider,” Mlotshwa said.
In an earlier analysis of the move, IH Securities said Padenga’s mining company Dallaglio would be the strategy’s most immediate beneficiary.
IH said a VFEX listing would pave the way for Dallaglio to venture into new gold assets and position itself to benefit from the attractive forex retention thresholds recently announced by the Ministry of Finance.
The thresholds present growth opportunities for gold miners and VFEX listed companies.
Padenga rushed to Dallaglio about two years ago, as it branched out from its traditional business of processing crocodile skin into gold mining in a surprise move.
Thanks to Dallaglio, Padenga gained a foothold in the Eureka gold mine, which returns to production this month after an injection of US $ 40 million to restart operations.
The transaction also gave Padenga access to the Chegutu-based Pickstone mine, a gold asset of 60 kg per month.