Korean investor ups ART stake

HARARE - Zimbabwe Stock Exchange (ZSE)-listed Art Corporation (Art) plans a mandatory offer to minority shareowners after Korean shareholder Taesung Chemicals (Taesung) upped its stake in the group beyond the prescribed 35 percent.

According to sources, Taesung increased its stake in the stationary and batteries maker from around 33,85 percent to 41,9 percent.

Taesung held the 33,85 percent through two investment vehicles, Cranbal Investments Private Limited and Silverline Investments.

ZSE’s listing rules dictate that a single investor that raises their stake above 35 percent must make an offer to buy-out minorities.

“Pursuant to the ZSE listing requirements, the shareholder is obliged to make a mandatory offer to minorities,” Art said in its financials for the year ended September 30, 2014, adding that “the offer will be made in due course.”

The offer, however, is subject to regulatory approval.

During the period under review, the group incurred a $1,1 million loss compared to a $399 000 profit recorded in prior comparable period.

Revenue went down five percent to $28,7 million while overall capacity utilisation fell to 59 percent from 65 percent.

“Sales and revenues were lower across most of the business units with an average volume decline of 11 percent in batteries and 17 percent in tissue operations while Eversharp volumes grew by five percent, the group said.

Although the group incurred the loss of $1,1 million, it ended the year better with the second half posting earnings of $91 000 compared to a first half loss of $1,2 million.

“Cash of $3,1 million was generated from operations down on last year by five percent. This was utilised to reduce debt and finance interest burden amounting to $2,3 million.

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