|ZSE Initial Public Offer on course|
|Thursday, 05 July 2012 11:40|
THE Securities Commission of Zimbabwe says it will soon be carrying out an Initial Public Offer for the Zimbabwe Stock Exchange as part of the demutualisation process for the bourse.
He was speaking in Harare on the sidelines of the Chief Finance Officer Summit 2012, organised by the Association of Chartered Certified Accountants.
“The IPO is part of the demutualisation of the bourse. In doing so, brokers will obviously get a stake, while at the same time we are seeking a partner to come in and help it modernise quicker.”
Mr Chinamo said they were still in discussions with the relevant ministry on the implementation of the IPO.
But it is expected that the introduction of real-time trading would allow for real-time clearing and settlement of trades.
In a recent address during the Annual General Meeting of the ZSE, interim board chairperson Mrs Eve Gadzikwa said the demutualisation process was well underway.
“To this end, a number of meetings have already been held with the aim to establish a framework and modalities towards a demutualised exchange,” she said.
The demutualisation plan, which was mooted four years ago, is believed to require more than US$4 million for effective implementation.
Market watchers believe that the slow pace on demutualisation has impacted negatively on the overall value of shares being traded on the bourse.
This “name-and-shame” strategy is one of the measures the commission is implementing as part of a broader strategy to improve disclosure by local firms.
It is anticipated that these initiatives will provide a high level of investor protection, promote market integrity and investor confidence, while preventing market manipulation and ensuring transparency in capital markets.
Poor disclosure of information by local companies is believed to be one of the major contributors to the high levels of poor corporate governance that has resulted in the recent collapse of a number of companies.
“It is with much regret that we observe inappropriate disclosures in the Press that are attributed to members or so called sources that refuse to be named,” she said.
The commission, which has started a programme to reform the capital markets, was established thorough the enactment of the Securities Act (Chapter 24:25).