Dawn Properties set for ZSE delisting

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BY FIDELITY MHLANGA

ZIMBABWE Stock Exchange (ZSE)-listed property concern, Dawn Properties, is set to delist from the bourse after hotelier African Sun Limited (ASL) made an offer to acquire 100% issued shares in the company in a deal that will see it assume ownership of the firm’s key assets.

Currently, Dawn Properties owns hotels that are being leased by ASL, but both companies are controlled by Arden Capital, formerly Brainworks.

“In May 2020, the board received an offer from African Sun Limited (African Sun) to acquire 100% of the issued shares of Dawn Properties Limited (Dawn). In terms of the offer, Dawn shareholders who accept the offer will receive one African Sun ordinary share for every 3,988075946 Dawn ordinary shares held. African Sun has stated that upon completion of this transaction, Dawn will be delisted from the Zimbabwe Stock Exchange,” said chairman Graham Johnson in a financial statement for the six months ended June 2020
Dawn Properties hotels that are leased by African Sun include Monomotapa Hotel, Elephant Hills Resort and Conference Centre, Great Zimbabwe Hotel, Caribbea Bay Resort, Holiday Inn Mutare Hotel and Hwange Safari Lodge.

The two companies used to be a single entity with African Sun, then known as ZimSun owning most of the hotel properties. They were, however, demerged in 2004 with Dawn Properties separately listing on the ZSE.

The major shareholder in both entities is a Mauritian investment holding company, Arden Capital Limited (formerly Brainworks Limited).

Arden Capital owns 57,67 % in African Sun and 66,81% in Dawn Properties.

During the first six months of the year, Dawn Properties realised a profit of $1,13 billion down from $3,6 billion.

Revenue retreated to $58,91 million from $73,76 million prior year.

During the period under review, hotel assets contributed 52% to the group revenue compared to 72% in the prior year.

At $31,7 million, hotel revenue for the six months ended June 30, 2020 was 39% lower than the comparative prior reporting period as a result of depressed occupancies.

As at June 30, 2020, the average occupancy rate for the hotel assets was 21% in comparison to a 41% occupancy rate achieved over the same period in the prior year.

Given its exposure to the tourism sector, the group’s performance was significantly affected by the lockdowns as hotel occupancies plummeted due to COVID-19-related travel restrictions. African Sun Limited, a related company that leases seven hotels from the group, reported that as at May 6, 2020, it had suffered cancellations of almost 32 000 room nights.