Dumisani Ndlela, Staff Reporter
AMALGAMATED Regional Trading Holdings (ART) has signalled its intention to rope in a technical partner to boost working capital.
The ART board, led by Passmore Matupire, has proposed a special resolution under which it intends to place 40 million authorised but unissued ordinary shares under the control of directors. The resolution will go to an annual general meeting (AGM) of shareholders as a special resolution.
While directors will seek absolute discretion in the use of the shares, they will be barred from undertaking deals that might result in a loss of control by controlling shareholders.
They may issue the shares in pursuance of any contracts but “the shares will not be issued in order to effect a change of control and will be issued in accordance with ZSE (Zimbabwe Stock Exchange) regulations and international business companies act provisions,” said a notice issued to shareholders ahead of the AGM, scheduled for early next month.
There are indications that planned transactions might involve a foreign partner.
The board is also proposing a depository receipts executive scheme as a special vehicle for employee share ownership.
Matupire said in his statement accompanying financial statements for the year to September 30 2009, that the group had gone through a turbulent period.
“Due to the losses accumulated during the year, the group’s cash flows were negatively affected and the business experienced working capital shortages. Recapitalisation of the balance sheet and rationalisation of the business portfolios are key focus areas for the group in the short term,” he said.
The prices of newsprint have continued to fall, putting further pressure on margins.
A review of Mutare Board & Paper Mills' operations is underway to ascertain the viability of the operation.
Matupire said the newsprint machine resumed operations in August but a decision was made to stop operations in early November as the plant was unprofitable due to persistent breakdowns.
