Seed Co mulls VFEX move
SEED Co Limited becomes the latest Zimbabwe Stock Exchange-listed company to announce plans to migrate to the Victoria Falls Stock Exchange.
In a cautionary statement released Wednesday, the seed producer said: "The investing public is advised that the Board has approved the migration of the Company's listing from the Zimbabwe Stock Exchange to the Victoria Falls Stock Exchange".
“Accordingly, shareholders are advised to exercise caution when dealing in the Company's securities. Further announcements will be made in accordance with regulatory requirements as and when there are material developments,” reads part of the statement.
Firms moving from the ZSE to the VFEX have found the latter attractive given the incentives that are on offer. The VFEX, among other things, allows for easier repatriation of dividends and more transactional flexibility for existing shareholders.
Analysts believe this helps attract a more diverse shareholder base and enables listed firms to raise the value of their holdings.
In addition, the VFEX offers tax incentives for shareholders, which include a 5 percent withholding tax on dividends and no capital gains tax on share disposal.
VFEX is also expected to elevate Seed Co's local and international profile which would in turn boost the company's commercial standing. Further, the VFEX is seen as providing better prospects for firms to raise capital from foreign investors. The stock exchange game changer in the trading of securities as well as a conduit for portfolio investments and foreign direct investments in the rest of Africa in hard currency.
In 2022, the VFEX closed on a high note with market capitalisation at US$411 million as the bourse continues to attract high-end firms in mining, manufacturing, and financial services.
The rapid growth of the VFEX in the last quarter of 2022 brought excitement to the financial services sector, injecting much-needed confidence and cementing the country as a safe investment destination, a vital cog that buttresses the “Zimbabwe is open for business” mantra.