This comes at a time relations between SECZ and the ZSE have soured, with the former accusing the latter of “sitting behind the wheels”. A corporate action is any event that brings material change to a public company and may affect its stakeholders. Some corporate actions such as a dividend may have a financial impact on the shareholders, while others such as change in company name do not have a financial impact.
The Commission has also raised concern after a consortium of local and foreign investors snapped up a controlling shareholding in construction giant, Murray and Roberts (M & R).
According to the transaction, Zumbani Capital snapped up 9 792 515 shares at a special bargain price of US$0,0147 per share. The special bargain price was at a 79% discount to the last traded price of the share which was US$0,07.
Tafadzwa Chinamo, SECZ chief executive officer told Standardbusiness last week the review would consider whether proper procedures had been followed.
“If we see a transaction we believe happened even without approvals being done, we will do whatever we can to address that situation, even if it means cancelling or reversing that transaction,” Chinamo said.
Chinamo said the Commission was finalising its examinations on the M & R deal and would make its recommendations to the parties concerned. “If it warrants undoing that deal, it’s an option,” he said.
Chinamo said although M & R issued a cautionary statement, it didn’t say the current shareholder is selling. It means there is a change in ownership and a circular to shareholders was appropriate, he said.
Under normal circumstances, a company intending to do any corporate action files circulars with both the stock exchange and SECZ. However, this has not been the case with SECZ telling listed firms in a notice published last week, to file circulars with both the exchange and the Commission “in order to avoid corrective measures being taken should such corporate actions be found to be irregular”.
Chinamo said amendments to the Securities Act would require the stock exchange to gazette its listing rules and direct companies to ensure that notices for annual general meetings are sent out on time and what to be discussed at those meetings.
He said the Commission was also drafting rules to complement effectiveness of the Act. The rules are being drafted at the Attorney General’s office with technical assistance from the World Bank.
Listing committee vital for all deliberations: Chinamo
Chinamo told Standardbusiness, the listing committee of the stock exchange should deliberate on all corporate actions before they are approved.
“Any action that takes place, rights issue consolidation of shares, the listing committee will be instrumental. In the past the committee was in name only,” he said.
He said going forward, a member of the Commission would sit on every committee of the exchange in attendance, such that things that may be overlooked by the exchange, would be pointed out and corrected.