Powerspeed Electrical Circular to Shareholders regarding approvals sought for the termination of its listing on the ZSE
If you are in any doubt as to the action you should take, please consult your stockbroker, bank manager, legal advisor, accountant or other professional advisor immediately.
Action Required:
- If you have disposed of your ordinary shares in Powerspeed Electrical Limited (“Powerspeed”), this Circular should be handed to the purchaser of such shares or the stockbroker, banker or other agent through whom the disposal was effected.
- If you are unable to attend the Extraordinary General Meeting of Powerspeed to be held at Powerspeed Complex, Corner Cripps Road and Kelvin Road North, Graniteside, Harare, on Monday 14 December 2020 at 1000hrs, or at any adjournment thereof, and wish to be represented thereat, you should complete and return the attached Form of Proxy in accordance with the instructions therein to be received by Powerspeed’s Transfer Secretary, no later than forty-eight (48) hours before the time of the Extraordinary General Meeting.
- If a Form of Proxy for the Extraordinary General Meeting is not received by the Transfer Secretary by the appropriate time set above, it may be handed to the Chairman of the Extraordinary General Meeting, who may accept the proxy at their discretion not less than thirty (30) minutes before the commencement of the Extraordinary General Meeting.
- This Document contains details of resolutions to be voted on at the Extraordinary General Meeting which, if passed with the requsite majority, will result in the termination of the listing of Powerspeed shares on the official list of the ZSE.
SUMMARY
THIS SUMMARY SHOULD BE READ AS AN INTRODUCTION TO THIS CIRCULAR AND ANY DECISION WITH RESPECT TO THE EXTRAORDINARY GENERAL MEETING SHOULD BE BASED ON A CONSIDERATION OF THIS CIRCULAR AS A WHOLE.
Salient Details
The salient details provide an outline of the proposal and should be read in conjunction with this Circular as a whole. The definitions on page 2 of this Circular have, where applicable, been used in this summary.
This summary presents the salient information in relation to a proposed Extraordinary General Meeting to consider, and if deemed acceptable, approve resolutions that, if and when implemented, would result in termination of the listing of Powerspeed on the Main Board of the ZSE. The Directors of Powerspeed are supportive of the delisting.
The coming into effect of the proposed delisting will be subject to the approval of the proposed delisting by a majority in number representing three-fourths by percentage (75%) of the shareholding of Powerspeed, present and voting either in person or by duly authorised proxy at the Extraordinary General Meeting to be held at the date, time and place detailed in the notice of such meeting.
This Circular should accordingly be read in its entirety, together with the Powerspeed 2019 Annual Report and the audited financial statements for the years ended 30 September 2018 and 2019, and the interim results for the six months to 31 March 2020, which includes the opinion of Grant Thornton.
RATIONALE OF THE DELISTING
The Board of Directors of Powerspeed are of the view that in the current environment in Zimbabwe, a listing on the Zimbabwe Stock Exchange has very little benefit and considerable costs. Powerspeed is a very illiquid stock and trading often does not represent a realistic valuation. The lack of capital from institutional investors means that the listing has limited value in terms of a mechanism to raise capital and ongoing legal, compliance and audit costs are an impediment to shareholder returns. In the face of a difficult trading environment the additional costs of being listed, with no compensating benefits, can no longer be borne by the Company. Accordingly, Powerspeed has decided to propose to shareholders its delisting from the ZSE. The ZSE have directed that Powerspeed provide a mechanism to shareholders wishing to exit their shareholding prior to the delisting, which mechanism is detailed in the Offer.
OPINIONS AND RECOMMENDATIONS
The Directors of the Company are of the view that a Zimbabwe Stock Exchange listing cannot be justified in light of the above, and are supportive of termination of the listing. They therefore recommend shareholders vote in favour of the resolution to terminate the listing as proposed in the Notice of the EGM, contained in this Circular.
INSPECTION OF THE CIRCULAR
The public may inspect this Circular during normal business hours from Friday, 20 November 2020 to Monday 14 December 2020, at the following offices:
| Sponsoring Brokers: | Financial Advisors: |
| Imara Edwards Securities (Private) Limited | Imara Corporate Finance Zimbabwe (Private) Limited |
| Block Two, Tendeseka Office Park | Block Two, Tendeseka Office Park |
| Samora Machel Avenue | Samora Machel Avenue |
| Eastlea | Eastlea |
| Harare | Harare |
| Zimbabwe | Zimbabwe |
| (P.O. Box 1475, Harare) | (P.O. Box 1475, Harare) |
Transfer Secretary:
First Transfer Secretaries Limited
1 Armagh Ave
Eastlea
Harare
Zimbabwe
Powerspeed Electrical FULL Circular to Shareholders – Nov 2020.pdf
Powerspeed Electrical Abridged Circular – Nov 2020.pdf
