Econet to rebrand TN Bank

HARARE - Econet Wireless (Econet) plans to rebrand TN Bank Limited (TN bank) following its acquisition of the financial institution.

While sources said the mobile network operator had already changed TN Bank’s operating system, Econet could not disclose details of the rebranding exercise.

“There are several strategies which Econet is planning for TN Bank, and these include repositioning the bank’s corporate brand,” Econet’s corporate communications manager Ranga Mberi told businessdaily, adding further information would be released in due course.

Mberi said the group also intended to expand the bank’s “market share and product profile, including the successful EcoCash mobile money transfer service”.

The sources said the rebranding exercise is part of Econet’s efforts to align TN Bank’s operations with its interests.

Econet acquired 45 percent of TN Bank’s issued ordinary share capital in July 2012 after injecting $20 million into the institution.

This shareholding enabled Econet to influence the strategic direction of TN Bank.

Under the new deal, Econet will pay close to $30 million or equivalent to acquire the remaining 55 percent ordinary shareholding in TN Bank.

TN Banks’ single largest shareholder and founder Tawanda Nyambirai will swap his stake in return for cash and shares in Econet.

Econet is offering 15,91 cents for every TN Bank share or one Econet share for 28,79 cents TN Bank shares.
Meanwhile, TN Bank will delist from the Zimbabwe Stock Exchange.

The Bank is widely viewed as one of the fastest growing indigenous banks in an economy recording sluggish growth.

In a circular to shareholders TN Bank said the rationale for delisting includes the fact that the share has been illiquid and has only traded 33 days since listing in July.

The volumes traded have also been low with an average of 0,01 percent of the shares in issue being traded.

“The illiquid nature of TN Bank counter has meant that shareholders have not derived any value from the listing of TN Bank limited,” said Lorcadia Chakurira, TN Bank’s company secretary.

“The poor trading nature of the company’s share has resulted in a constant decline in the price of TN Bank share since listing,” she said.

The counter was listed at $0,32 per share and as of last week, it was trading at $0,16 — a discount of 36 percent on the company’s net asset value of $0,25 per share.

Chakurira said the delisting will also allow the institution to trade at its true value as “current trading on the stock exchange is undervaluing the company.”

She said new directors will be appointed and the bank will be recapitalised in line with the Reserve Bank of Zimbabwe’s requirements. TN Bank will re-list once the trading environment has improved.

While TN Bank had already surpassed the $25 million required in the first phase, it still has to meet the second phase of $50 million by June 30 and $75 million six months later. - Eric Chiriga, Business Editor

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