National Foods becomes first firm to leave Victoria Falls Stock Exchange

By Bloomberg

National Foods Holdings Ltd. will take the company private and delist from Zimbabwe’s Victoria Falls Stock Exchange, which trades exclusively in US dollars, as it doesn’t foresee raising capital anytime soon.

“The company no longer requires capital from equity markets in the near term, reducing the advantages of maintaining a VFEX listing,” Zimbabwe’s biggest and oldest food manufacturer said in a circular Wednesday.

The manufacturer founded in 1920 switched its listing to VFEX, from the Zimbabwe Stock Exchange located in the capital Harare, which trades in local currency, two years ago. National Foods will offer $23 million to public shareholders to buy back the shares.

Companies were drawn to VFEX that debuted in 2020 as it allowed them to trade and raise capital in US dollars and offered a raft of tax incentives.

National Foods also said it plans to delist as South Africa’s Tiger Brands Ltd. and Innscor Africa Ltd. jointly hold 75.18% of the company limiting “the influence and participation” of smaller retail investors.

National Foods will buy 20% of the company’s shares at $1.71 apiece. This will allow investors to “access the full value of their shares and address the liquidity constraints associated with the shares’ limited trading activity on the VFEX,” it said.

The delisting will also grant the company “increased flexibility” to streamline operations and concentrate on long-term strategic objectives, National Foods said.

The VFEX currently has 15 listings and a market capitalization of $1.3 billion, according to data provided by the exchange. National Foods said it intends to complete the delisting by Jan. 31.