HomeLocal NewsKingdom Bank up for sale

Kingdom Bank up for sale

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Meikles Limited has announced it would sell its shares in Kingdom Financial Holdings (KFHL) to anyone who makes an “acceptable” offer, before or after its extraordinary general meeting (EGM) slated for the 13th of next month.

Meikles Limited holds 42,9% of KFHL through John Moxon and the Meikles Family.

In terms of the disinvestment deal, Nigel Chanakira – KFHL’s founder – will have to compete with other potential suitors for the stake with a fair value of
$15 million.

Chanakira is sweating to repossess KFHL by buying the equity currently held by Meikles and an additional 10,5% controlled by a local consortium led by Rugare Chidembo.

The Meikles board last month threw out the embattled banker’s bid, arguing that it was not convinced by his proposed payment plan, and announced it would call for an EGM where shareholders would vote to separate KFHL and Meikles Limited, on amended terms.

But National Indigenisation and Empowerment Board (NIEB) chairperson David Chapfika says Chanakira has up to five years to raise the money in terms of Zimbabwe’s Indigenisation and Empowerment Act and its subsidiary legislation.

KFHL and Meikles merged into Kingdom Meikles Limited (KML) in January 2008 by transferring KFHL and Meikles shares to KML on a one-to-one basis, implying Chanakira’s 2,58% in KFHL was converted directly into a 2,58% equity in KML.

In June last year, KML shareholders also agreed to demerge KFHL from Meikles on the same terms.

In its latest notice to shareholders, Meikles Limited said it would dispose its KFHL shares amounting to 234 million to a bidder whose offer wins the approval of shareholders in a vote, which would be presided over by Deloitte & Touché Zimbabwe or any other chartered accountants nominated by the chairman.

“Shareholders are advised that in the event that an acceptable offer to the board for the purchase of the company’s shares in KFHL is received prior to the date of the EGM, an amended notice incorporating a resolution so that shareholders can vote on the offer, together with details of such offer, a recommendation from the board, and a new form of proxy, will be sent to shareholders,” Meikles said.

Under the one-to-one demerger terms, Chanakira would retain 2,58% in KFHL after the corporate divorce.

The banker plans to acquire Meikles Limited shareholding in KFHL to bulk up from his current shareholding after he lost a boardroom war with John Moxon, who controlled Kingdom Meikles Limited (KML) – the merger of KFHL and Meikles Limited.

At the EGM, shareholders are also expected to vote on two other resolutions: the seperate listing of KFHL and the distribution to all Meikles shareholders of all the 245,4 million issued KFHL shares that would remain after the proposed transfer of 234 million shares to KFHL.

The board also seeks the mandate to list all the issued shares of KFHL on the Zimbabwe Stock Exchange by way of an introduction.

To date the demerger has not been implemented both due to the issues the company faced at the end of 2009 and early 2010 due to the non fulfilment of all the demerger’s conditions.

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