Simbisa aims for secondary AIM listing
ZIMBABWE and sub-Saharan Africa focused fast foods operator, Simbisa Brands – which holds franchises for Nando’s, Chicken Inn, Steers and Pizza Inn – is seeking a secondary listing on London’s AIM market.
Simbisa Brands was unbundled and separately listed on the Zimbabwe Stock Exchange in 2015 by Innscor Africa, one of the highly capitalised counters on the Harare bourse. It has quick-serve restaurant operations in countries such as Mauritius, Ghana, Kenya, Zambia, Namibia and DRC among others.
However, its major market has remained in Zimbabwe and the board of Simbisa has now approved the move to a London listing although this now awaits regulatory approvals.
“Shareholders are advised that the Simbisa Brands board of directors has approved, subject to Reserve Bank of Zimbabwe, other regulatory approvals and shareholder’s approval, the application for a secondary listing of Simbisa’ ordinary share capital on the London Stock Exchange Alternative Investments Markets (AIM) in order to access additional funding for the Company’s expansion,” Simbisa Brands said in a cautionary notice yesterday.
Market watchers said they expected the regulatory approvals to be secured. The company has earmarked expansion both inside and outside Zimbabwe to boost its prospects.
Addington Chinake, the chairperson of Simbisa Brands, has said that “the combined revenue for the regional operations increased by 10 percent to $30.2 million” (R390m) in the full year to December 2016.
Analysts at Exotix have forecast revenue and earnings before interest, taxes, depreciation and amortisation (Ebitda) earnings of $157m and $19.2m respectively, for the full year to June 2017. This is expected to yield a year on year growth of 7 percent and 34 percent on revenue and Ebitda, respectively.
And coupled with a secondary listing in London, Simbisa Brands is expected to be in a strong position to fund expansion.
However, Exotix said in a note on the company recently that “expansion targets are not set in stone, as they will depend on opportunities in each individual market” while “Zimbabwe has a very uncertain outlook”.
But Simbisa said in its cautionary note that it was pursuing an acquisition. The target was an international company in the same fast foods industry.
“Shareholders are also advised that Simbisa is currently in negotiations for the acquisition of an international complementary business,” the company said.