ZBFH says it now holds a controlling 50.58% stake in the listed property company
ZBFH continues its investment spending
Harare-Zimbabwe Stock Exchange-listed financial outfit, ZB Financial Holdings (ZBFH) has increased its investment portfolio by increasing its stake in ZSE-listed Mashonaland Holdings.
ZBFH says it now holds a controlling 50.58% stake in the listed property company. The financial group has been leading towards this ownership stake since last year when the group acquired 40.59% percent of the property shares last year.
In a statement referring to the deal which was originally announced on the 20th of December last year, a company representative was quoted saying “ZB Financial Holdings has since paid the total purchase consideration of the shares tendered in terms of the offer and accordingly ZBFH now holds a controlling block of the outstanding shares in Mashonaland Holdings Limited.” The quote continues by saying, “We [ZBFH] wish to thank all shareholders and the investing public for their continued support and confidence in the ZBFH vision”.
A vision that has seen the group making some significant investment spending. The group recently launched a new financial services Centre in Gweru. An investment the group believes will improve service delivery by being a one-stop shop for all customers. “The service center provides financial services in banking, insurance, and investments all under one roof,” said Shepherd Fungura, the group’s chief executive officer said at the official opening in February. This comes after the bank recently opened a premium center in Harare and launched the “My ZB App” for easier customer transactions. The importance of improvements in customer delivery is clear given the level of competition in the banking sector. Moreover, given that a significant portion of revenue stems from service fees, investments that widen the scope of services that ZB Bank offers, will likewise increase the bank’s earning potential.
The merit of the investment into Mashonaland Holding (MASH.zw) however is less clear given the ensuing economic slowdown which might adversely affect occupancy levels. Moreover, in its last trading update, MASH.zw stated that its net property income as a percentage of revenue decreased from 83% to 78% due to increases in property expenses. Property expenses were said to have increased by 98% driven by maintenance works which are expected to continue to ensure the continued quality of space. Although this may be adverse in the short run, it is expected to be positive in the long run given such investments will increase demand.
The merit of the increase ZBFH’s stake in MASH.zw is yet to be fully valued. However, the strategy of both companies has suggested an interest to diversify. This statement is supported by the outlook reported by MASH.zw in its last published trading update. -Equity Axis
