AfriFresh, the new investor in Ariston Holdings, has increased its stake in the horticultural group following the approval of a rights offer where the South Africa-based firm was the underwriter.
Before the rights issue, AfriFresh held 41,74% in the horticulture concern.
According to the results of the $8 million rights offer, the underwriter took over 190 013 652 shares at $1,710 123 amounting to 21, 38% of the issued shares.
Rights followed by members totalled 78, 62% subscription valued at $6,2 million that translated to 698 875 237 shares.
An official from the company said there were no underwriters from the local market.
We havent seen the transfer register. We are waiting for the register from the transfer secretaries so that we know how much percentage has been taken by the underwriter.
Ariston yesterday said it had received requisite regulatory approvals from the exchange control division of the Reserve Bank of Zimbabwe, Youth, Indigenisation and Empowerment ministry, the Zimbabwe Stock Exchange and the Securities Commission of Zimbabwe.
In February, Ariston Holdings shareholders approved a plan to raise $8 million to recapitalise the group at an annual general meeting.
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The funds to be raised through the rights issue would finance capital expenditure projects and working capital needs as well as retire debt.
At least $1,955 million will be allocated to capital expenditure, $3 million to debt retirement and $2, 8 million to working capital.
Speaking at the AGM, the companys chief executive officer Paul Spear said the recapitalisation would have a significant impact on the business.
AfriFresh produces 250 products sold in more than 15 countries in the world.
It entered into Ariston after Emvest sold its 42% stake in the company.
Turning to revenue projections, Spear said the company expected a turnover of $22,1 million for the year ending September 30.
He said the company would focus on increasing capacity utilisation, operational efficiency and profitability and cash generation this year.
Volumes remain below potential, there were high labour costs, capacity utilisation was low and funding for inputs was expensive, he said.
