DPC seeks MicroKing suitors

0
1179

THE Deposit Protection Corporation (DPC) is inviting interested companies to buy the entire shareholding in MicroKing, a microfinance unit for AfrAsia Zimbabwe Holdings.

by BUSINESS REPORTER

The invitation to tender comes after sources told NewsDay last month six firms — including a Zambian company — had shown an interest in MicroKing.

In a notice last week, DPC said interested parties should register interests with MicroKing’s transaction advisors at Grant Thornton Chartered Accountants by May 11.

Interested parties should complete registration forms and pay a non-refundable documentation fee of $10 000. They should sign a non-disclosure agreement prior to receiving the information memorandum and other relevant documents, DPC said.

“This invitation is not a prospectus and does not constitute or form part of any solicitation or invitation or any offer to the public to purchase or subscribe to any ordinary shares or any other shares in MicroKing Finance (Private) Limited,” DPC said.

MicroKing’s sister company AfrAsia Bank Zimbabwe had its licence cancelled after failing to meet the $25 million minimum equity capital threshold.

MicroKing has been a profitable business for AfrAsia Zimbabwe Holdings. Finance minister Patrick Chinamasa has in the past said the government would bend the rules to save MicroKing from collapse as the microfinance company was assisting the informal sector.

The Department for International Development (DFID) United Kingdom said it had investments amounting to $800 000 in MicroKing.

MicroKing has been lending finance to medium and small enterprises.

Since 2009, the microfinance firm channelled over $200 million to small and medium enterprises. Micro lending has become an important feature in lending in the country as the economy is now dominated by the informal sector.

The country’s formal sector takes up to 20% of the economy, while the rest is in the informal sector.

Zimbabwe’s economy has shifted from being formal to informal as most companies are closing down due to the harsh economic conditions.