Econet offer to rescue ZSE

ZIMBABWE-LISTED telecommunication’s company Econet Wireless has offered to extend a “no-strings-attached” loan facility to the Zimbabwe Stock Exchange (ZSE) to purchase an electronic platform that will improve transparency on the local bourse.

Business Reporter

In a statement yesterday, the telecommunications company said this was in line with regional trends such as in South Africa and Kenya.
Trading on the ZSE remains manual as automation has taken longer than expected.

Econet called for urgent reforms of the share trading system of the ZSE saying the current system was “subject to abuse and perpetuates an elitist old boys clubs”.

“It is time for the Zimbabwe Stock Exchange to become more accessible to ordinary people and a proper vehicle for mobilising capital for companies,” Econet said.

Securities Commission of Zimbabwe chairperson Willia Bonyongwe last week told NewsDay the automation of ZSE would bring vibrancy to the bourse whose performance had not been improving since 2009.

“I believe the reason is a lot of people are not really confident to participate on the market currently for reasons ranging from past experience governance issues to do with the listed companies themselves,” she said. “There is tyranny of the minority by the majority shareholders.

“Other reasons have to do with the state of the listed companies. Very few have reasonable capacity and production. Automation will bring vibrancy as well as stringent corporate governance requirements,” Bonyongwe said.

“Obviously economic recovery will definitely increase aggregate demand and gross national savings available for investment.
“The new investment in mining and the Indigenous and Empowerment Sovereign Fund will add to the positive sentiments and increased market activity and consequently augment market capitalisation.”

Meanwhile, Econet said the company’s board had approved a share split of “10 to one”, to enable small investors to buy and sell shares in the company. A share split is when a company reduces the paid value of its shares and issues more shares in the same proportion.

At Tuesday’s closing price of $6,10, it means that any small investor would spend a minimum of $610 to buy 100 shares; after the share split, 100 shares will now cost only $61.

The decision by the board followed a study by the company, which showed that the shares were now so expensive that only foreign investors were now buying shares.

Officials say the level of foreign ownership in the company has shot up from a mere 10% at listing in 1998, to more than 30% today.

9 Comments

  1. LOL! No strings attached??!! Don’t make me laugh Econet! Isn’t this a trojan horse meant to imbed ecocash into the zse platform… Zse ichatsvaka mari yoga isiyei, haina kumbofamba ichipemha!

  2. true no strings attached ??? really and you expect anyone to believe that!!! but anyway atlist small buyers will be able too but if those go thru something is going to hapen like in future 80 or so pecent of shares being bhought thrue ecoshare or whatever one of thier products

  3. Do you have a solution. ZSE is a laughing stock, in this day of the electronic age its still using a manual approach! Something is terribly wrong here, who the hell has been sleeping on the job? For the past year if not more I have been trying to access the ZSE website, guess what, it has and is still under construction. The guys in charge of this unit are as deliquent as the party that has been running the country and should be fired. If it was in China they would be literally fired at!

  4. they will neva go electronc because that will at some level stop coruption and they cant have that

  5. People are watching..the ZSE has gone on with this nonsense long enough as it is. By the way are we going to be told how much inducement was Munykwi paid to drop his suit against them? This opacity at ZSE is not helping issues at all and Oh by the way how many times have we heard about the computerisation of the bourse..now how can you achieve this when you dont even a simple thing like a website that functions? This cant be allowed to go on in endless perpetuity or can it?

  6. Seriously! Econet is taking over the market place while these thieves think its “just a loan”

  7. I hope someone will not say a certain political party is behind this like the Local Gvt ministry did when Econet offered to maintain street lights.

  8. the endeavour to modernise the local bourse is well received. the zse has for too long been trapped in archaic operations, albeit due to funding issues.
    However, i percieve this move as being a threat to the independence of the zse. How does the pupil buy his teacher a red pen to mark his and others’ script. Let us adopt a visionary posture in these strategic issues.
    Those who believe in the philosophy of the Bible will appreciate the veracity of the often quoted scripture, ‘money answereth all’. the question is, what question is econet answering? We all know it is not merely a social enterprise.

  9. Traditionally, vakuru vaiti “Nyasha dzei tsvimborume kubvisa mwana wemvana madzihwa” When I was readng this report, I said to myself okeeeey I see. Thats all I could say, but my other comment is, since when do we hev a single corporation “feeling” for everyone? Econet are u really sure this is a “no strings attached” arrangment? Well, if it is, well thank u, but its a good gesture, indeed it is, ZSE was becoming a joke, a serious joke for that matter!!!!!

    My other plea is get amply qualified pipo to this organisation and start afressh, oh not Econet, but ZSE i mean……..

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