GetBucks shifts to tap issue after slow uptake




HARARE – GetBucks MicroFinance Bank Ltd says it will now issue the second series of its bond listing by way of a tap issue after low uptake.

The second series of its medium-term note listing was aimed at raising $15 million on the Zimbabwe Stock Exchange’s (ZSE) debt market, but due to low uptake the firm is moving to list the notes privately.

Company secretary Mr Paul Soko told shareholders in a notice today that once the required threshold has been achieved through the private listing, the bond listing would be re-introduced on the local bourse.

“Uptake has been slow and is yet to meet the regulatory threshold to bring the securities to listing. The notes will now be placed privately by way of a tap issue,” he said.

“This second series of the programme will be listed by introduction on the Zimbabwe Stock Exchange after the threshold has been achieved.”

A tap issue is basically a procedure that allows borrowers to sell bonds or other short-term debt instruments from past issues.

In this respect, the bonds are issued at their original face value, maturity and coupon rate, but sold at the current market price.

Since the offer of the second series has now been closed, Soko said current subscribers to the issue as at July 21, will be issued with pricing supplements, that is documents detailing the issue.

A bond is a debt obligation, and allows companies or governments to raise capital at a fixed interest rate.

The GetBucks bond, whose first tranche raised $5, 4 million listed in April this year, becoming the first to trade publicly in Zimbabwe in nearly two decades after the bond market stopped operating.

This is the second tranche is part of a broader but phased $30 million capital raise by the financial services firm.

The bond has a three year tenure and a yield of 10, 25 percent.