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Mr Douglas Munatsi

Golden Sibanda, Business Reporter
ABC Holdings’ board has appointed a sub-committee of independent directors to oversee evaluation of the business to appropriately advise minority shareholders to sell or keep their shares. There currently are huge differences in the ABC Holdings family between majority shareholder ADC and minorities over the share price the former has offered to buy out minorities.

ADC is required in terms of the Botswana Stock Exchange rules, where ABC Holdings has its primary listing, to offer to buy out minorities after increasing its stake from 23 to over 50 percent.

But differences have emerged between shareholders over the US60c per share ADC has offered minorities after raising its stake when it underwrote ABC’ US$50 million rights issue last year.

ABC Holdings group chief executive Mr Douglas Munatsi said in an interview last week that the group would engage independent financial advisors to determine the value of the business.

“The board has appointed a sub-committee of independent directors who are actually overseeing that whole process so we will go to a party such as Deloittes, KPMG, Imara or ourselves because that is what we do in our investment business.

When that party gives an opinion to say ‘we the think the price is X’, the independent committee of the board is going to advise the whole board.

“We are not independent, we are not allowed in that sub-committee, there also are some shareholders who are not independent.

“As a group or as a board we will then be advised to say this is what the advisors are saying we will and this is what they recommend, that is what well then take a decision as a board and then we will advise shareholders to say US60c is too low or too high and recommend that u sell or that you don’t,” Mr Munatsi said.

The ABC Holdings CEO was responding explaining measures employed to ensure minorities are fully informed on whether to accept ADC’ offer or chose to retain their shareholding.

Mr Munatsi said minorities were not being forced to sale, but ADC was compelled to make the mandatory offer in terms of the mergers and acquisitions rules of the Botswana Stock exchange when a shareholders raises its stake above 34,99 percent.

Minority shareholders will then choose either to sell or retain their shareholding in the group depending on how they value the business.