BRAINWORKS Capital Management further consolidated its foothold in African Sun Limited by increasing its stake to over 50 percent after buying 17,6 million shares worth half a million dollars in normal Zimbabwe Stock Exchange trades yesterday.
The development means Brainworks continues to entrench its position in the listed hotel group as it prepares to make a mandatory offer to the latter’s minority shareholders. The hotel group is currently trading under cautionary ahead of the offer.
The shares which were traded at US2,8 cents were sold by local asset management firm Equivest for US$494 799.
Brainworks, a private equity investment and advisory firm, increased its shareholding in African Sun after it acquired a 32 percent stake in the hotelier through three vehicles previously controlled by ASL chief executive Dr Shingi Munyeza through his family trust, Nhaka.
In return Nhaka got 17,02 percent of Brainworks Capital. Brainworks became a significant shareholder in both African Sun and Dawn Properties. African Sun owns 16 percent in Dawn Properties, which owns most of the properties it occupies.
The group had just sold its 12 percent stake in Dawn to Lengrah Investment, a subsidiary of Brainworks. Nhaka Trust became a shareholder in Brainworks alongside African Development Corporation, Red Rock Capital and local pension funds.
Brainworks, through its investment portfolio companies, offers banking consumer finance products. Under its energy portfolio, Brainworks is active in petroleum products logistics and bulk trading markets, while in tourism and real estate portfolio, it is active in the hotel and real estate business.
This means the acquisition of shareholding of ASL and Dawn will consolidate Brainworks’ local tourism portfolio.
Brainworks is also involved in gold mining in Zimbabwe and is currently undertaking exploration. As at June 30 this year, Brainworks had total assets of approximately US$35,6 million, US$3,8 million as cash, while its total equity was US$26,7 million.
Among Brainworks key shareholders, Nhaka Trust and African Development Corporation are 17 local pension funds. ADC has been instrumental in the development of Brainworks Capital, particularly in tapping international capital markets for growth of Zimbabwe businesses and the Zimbabwe economy at large.
To date ADC has assisted Brainworks Capital in securing approximately US$18 million from its own cash resources and other international investors since 2009. ADC has also been instrumental in the further development of Zimbabwe’s banking industry through its landmark US$50 million investment in BancABC in July 2012.
ADC is a German-listed, emerging pan-African banking group. ADC has a strong footprint in Southern Africa via BancABC, a regional commercial banking platform operating in Botswana, Mozambique, Tanzania, Zambia and Zimbabwe as well as in West Africa via Union Bank of Nigeria.