HomeBusinessMedtech close to completing name change

Medtech close to completing name change


MEDTECH Holdings Limited expects to complete all processes needed to change its name to BridgeForst Capital Limited.

At an extraordinary general meeting on November 15, 2021 Medtech announced a series of plans to reclassify itself as a private equity firm and proposed changing its name to BCL.

It made the announcement as most medium-sized businesses rely almost entirely on organic growth and on vanilla bank loans — which require onerous collateral, have limited tenures, and attract high interest rates.

Thus, by becoming an equity firm, Medtech is seeking to attract additional funding for its operations.

Speaking at the presentation of its financial results for the year ended December 31, 2021, Medtech said the economic turmoil would make it continue to focus on looking for good opportunities, concluding private equity transactions and assisting underlying portfolio companies.

“We have been advised that the various changes required at the Registrar of Companies and Other Business Entities resulting from the EGM held on November 15, 2021 are expected imminently,” the company said in a statement attached to the financial results under review.

“Shareholders will be advised as soon as the final documents have been received and the ZSE has approved the announcement to shareholders and the renaming of the shares.”

According to a circular dated October 22, 2021, concurrently to the change of name, BCL is seeking a general authority to issue Class B shares to investors, the proceeds of which will be used to conclude the acquisition of a “viable asset”.

The company reported that the economic rights to the proceeds of these shares or any asset purchased using the proceeds will flow to a different class of shareholders — Class B shareholders.

Further, shareholders would also receive Class C shares and Class D shares as part of the transactions that would remain unlisted for the time being as share classes that shall be used to conclude future transactions.

Class A shares will continue to be listed on the main bourse, representing Medtech’s consumer arm, while Class B will reflect a receivable of US$100 200 relating to 50,1% of the land owned by Medtech Distribution, the firm’s subsidiary.

“The operating environment has deteriorated and become more unpredictable since year-end with doing business becoming more difficult,” Medtech said.

“Considerable management time is spent in reacting to and dealing with various issues which businesses in most of the rest of the world do not have to invest precious time in. The competitiveness of the informal sector is largely unhindered by policy pronouncements resulting in the informal players becoming an increasing threat to the formal economy.”

“Unfortunately, we envisage this trend continuing, resulting in a smaller tax net and increasing pressure on formal businesses.”

Equity remains a hedge for businesses to avoid dealing with inflationary pressure.

Medtech revenue grew 68,09% to $953,38 million in the year under review from a comparative $567,17 million in 2020.

“The businesses managed well on hedging mechanisms and this, along with a reduction in the real selling price of goods, less stockouts and a reduction in competition from grey imports and smuggled goods drove an increase in the volume of sales by 110% (198% in distribution and 20% in manufacturing),” Medtech said.

This led to a profit after tax, during the period under review, of $261,02 million, up from a 2020 comparative of $112,62 million.

However, Medtech warned that the year-end successful forex auction bids to the value of US$465 000 have been unpaid.

“The validated legacy debts amount to ZAR23,4 million (US$1,5 million), with ZAR5,9 million (US$379 532,44) of this having been settled leaving a validated balance payable of ZAR17,5 million (US$1,12 million) which has been provided for in the accounts at the auction rate). This legacy debt continues to hamper relationships with suppliers and timeous supply of goods,” Medtech said.

  • Follow us on Twitter @NewsDayZimbabwe

Recent Posts

Stories you will enjoy

Recommended reading