Tanganda guns for VFEX after ZSE return

TANGANDA Tea Company Limited chief executive officer Timothy Fennell yesterday said they were considering listing on the foreign currency-indexed Victoria Falls Stock Exchange (VFEX), as the tea producer returned to the Zimbabwe Stock Exchange (ZSE) following a 14year hiatus.

Fennell told NewsDay Business after relisting that the Tanganda board had opted for the ZSE first, while studying liquidity trends on the VFEX, a new bourse that began trading in October 2020 with only a few counters on board.

Caledonia Mining Corporation, Padenga Holdings Limited, Bindura Nickel Corporation and Seed Co International are the four counters currently trading on VFEX.

They have a combined US$451,84 million market capitalisation.

Tanganda relisted following an unbundling process by its parent, Meikles Limited first announced in March 2021.

“It was considered (listing on the VFEX) but it was decided by the board that for the time being we would stick with the current stock exchange. But, going forward, we may consider it,” Fennell told NewsDay Business after relisting on the ZSE.

He said Tanganda was seeking to unlock shareholder value on the ZSE first, before it considered a listing on the VFEX.

“One of the main objectives of the whole exercise (relisting on the ZSE) is to maximise and unlock shareholder value and of course to expand,” Fennell said.

Tanganda was supposed to have relisted on the ZSE on December 9, 2021 but it deferred as Meikles sought Zimbabwe Revenue Authority’s approval.

“Over the years, Tanganda has been transformed from being just a tea business to a diversified agriculture export business. To date, Tanganda has developed an expansive estate of both macadamia nuts and avocados and has been the single largest producer of both crops in Zimbabwe,” ZSE chairperson Caroline Sandura said.

“The relisting by Tanganda is testimony that there are practical and tangible benefits of being on a stock exchange like ours. Some of the benefits for listing include but are not limited to an enhanced corporate status, more liquid market for shareholders, the ability to attract and retain skilled employees and improved business relations.”

She said the continued support by Treasury through incentives had made the ZSE the preferred exchange for secondary trading of financial securities.

Tanganda has a 65% market share in Zimbabwe and exports 72% of its products.

It is also the biggest exporter of macadamia nuts and avocados in the country.

As of the financial year ended March 31, 2021, Tanganda’s total assets were worth $5,1 billion.

Fennell said depending on the performance of its livestock section Tanganda might consider establishing a company to focus on livestock business as part of its growth strategy.

“We could create another company; we have to look at it. We already have a substantial division and whether we create a new company to look after livestock only or whether we simply have a company that falls into Tanganda we’ll decide as we go on,” he said

“Of course, today is day one so there are still a lot of decisions to be made. We have a new board of directors and we require input from them as to how they would require us to structure the whole thing,” he said.

However, he said while the firm’s biggest export market was Zambia, it was focusing on growing the South Africa market.