Econet shareholders approve Cassava demerger

HARARE – Shareholders of Econet Wireless Zimbabwe have approved the demerger and independent listing of its Technology and Fintech business Cassava Smartech.

At an Extraordinary General Meeting (EGM) held at the company’s head office in Harare yesterday, Econet shareholders unanimously voted for the resolution to demerge and subsequently list Cassava Smartechas a separate company listed on the Zimbabwe Stock Exchange (ZSE).

The listing of CSZL will the largest initial listing on the ZSE, and will probably be the largest initial listing in the history of the local exchange.

Shareholders also voted to authorize and empower the company’s directors to effect and operationalize the demerger and the listing of the CSZL, which is scheduled for December 11, 2018.

The shareholder approval was seen as the last hurdle in the process leading up to the new technology company’s listing. It followed a series of initiatives by the company which included the publication of a detailed circular to shareholders on the planned demerger, the obtaining of regulatory approvals and a number of investor engagement road shows by the company’s senior management.

Shareholders voted overwhelmingly in favour of the resolution to spin off Cassava and list it separately on the ZSE, with 90% of the votes in favour of the demerger transaction.

The EGM however deferred voting on a resolution to convert debentures (issued at a rights offer last year) into ordinary shares.  This is intended to return value to those shareholders who provided US dollars offshore to the company to allow the company to pay off its offshore debts.  This proposal, which will be voted on by shareholders at a meeting to be held on 14 December 2018, is seen as a measure to protect shareholder value in the face of inflation that has eroded monetary values.

Dr Jim Myers, the EWZL board chairman said the directors had reflected on the views of various shareholders and elected to adjourn the EGM to December 14, 2018, to allow some shareholders that had requested more time to understand the transaction and to explain it to their clients.

Earlier in the day, an AGM that was held at the same premises at the company’s head office, saw all resolutions passed by unanimous vote.