Harare – London-listed Cambria Africa Plc is planning to snap additional shareholding in construction-allied and brick manufacturing company, Radar Holdings Limited.
Last year, Paynet Zimbabwe, a wholly owned subsidiary of Cambria, acquired a beneficial interest of 7.83 percent in Radar in a $1.6 million deal effective 31 August 2018.
In their FY18 results Cambria stated that they are looking at acquiring additional shares in Radar as investments in the Company provides an attractive hedge in the country.
“Cambria is in discussions to further increase its shareholding in Radar. Should the opportunity arise, the Company will rely on the pre-emptive rights of AF Philip to increase its shareholding in Hinshaw which owns 79.65 percent of Radar shares.
“In the opinion of the Board, Radar will be a direct beneficiary of any uptick in the Zimbabwe economy through its regional monopoly in brick manufacturing and its significant development land holdings. In addition, the Radar investment provides an attractive hedge against the possible deterioration in the purchasing power of cash and cash-equivalents in Zimbabwe.”
Subsequent to the end of the financial year, Cambri said Paynet deployed $400,000 to acquire an additional 1.15 percent shareholding in Radar. The transaction was implemented through the same subscription mechanism described above at an effective price of 68 US cents per Radar share.
The Radar acquisition was settled through subscription by Paynet for 62.84 percent of the ordinary shares of AF Philip & Company (Pvt) Ltd.
AF Philip holds a 15.65 percent interest in Hinshaw (Pvt) Ltd which, through its wholly owned subsidiaries, holds a 79.65 percent interest in Radar. The total consideration of $1.6 million translated into an effective price of 40 US cents per Radar share.
Radar was delisted on the ZSE in 2016 following its voluntary application for suspension due to underperformance of the Group.
In 2013, the Group plunged to a US$49 million loss for the year ended June 30 2013 after disposing of its 51 percent controlling interest in Border Timbers Limited to focus on its core business.
Radar Holdings owned 22 005 087 ordinary shares in ZSE listed timber group Border Timbers, but distributed its interest in Border Timbers in that year through a dividend in specie.
In 2015, the group’s revenue for the half-year period to December 31, 2015 was down 17 percent to $3 million compared to the previous comparative period mainly because of a 90 percent reduction in sales volumes and sales mix that was skewed towards lower value products experienced during the period.
Radar Properties owns 2.166 hectares in prime development in Zimbabwe and 8 residential properties. Among them is brick manufacturer, Macdonald Bricks with the capacity to produce 91 million bricks per year. It has a dominant market position in Matabeleland region.
In an interview with Equity Axis last year, the Group’s Finance Director, Walter Zimunya highlighted that demand in the FY2018 remained strong on the momentum built in FY2017.
“Production volumes are 11 percent above the same period last year. Sales volumes are 19 percent above same period last year and revenue 33 percent above prior year.”
Zimunya said going forward the company is working on a reinvestment project at Willsgrove plant to increase capacity and modernise operations and the remodelled plant is expected to be in commercial production in Q3.
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