ZCCM-IH Plc has increased its shareholding in Investrust Bank Plc from 45.4 per cent to 71.4 per cent, becoming the majority shareholder following acceptance of the mandatory offer from the bank’s minority shareholders.
According to a statement issued via sponsoring broker, Stockbrokers Zambia Limited, the mandatory offer by ZCCM-IH to Investrust’s minority shareholders was accepted for the former to increase its existing shareholding from 45.4 per cent up to 71.4 per cent.
A total of 2,125,890 shares were tendered for sale to ZCCM-IH representing 26.0 per cent of the total shareholding in the bank, according to the statement.
“Shareholders of ZCCM Investments Holdings Plc and Investrust Bank Plc are referred to the announcement of the mandatory offer by ZCCM-IH to the minority shareholders of Investrust issued on the Stock Exchange News Services on Wednesday, 21st March, 2018. The mandatory offer by ZCCM-IH to the minority shareholders of Investrust opened on Monday, 9th April, 2018 and closed on Monday, 30th April 2018. At the close of the offer, a total of 2,125,890 shares were tendered for sale to ZCCM-IH. This level of acceptance represents 26.0 per cent of the total shareholding in the bank. Accordingly, the mandatory offer increased ZCCM-IH’s shareholding in Investrust from 45.4 per cent to 71.4 per cent,” read the statement.
“The ZCCM-IH board wishes to acknowledge the overwhelming success of the mandatory offer and looks forward to better prospects for Investrust.”
Investrust has been incurring losses in at least four consecutive financial years, with K50.9 million being the largest losses recorded in 2015.
Last year, the bank recovered a total of K105 million in Non-Performing Loans (NPLs), compared to K56 million in 2016, according to its official results.
Investrust also fell short of meeting the Bank of Zambia’s minimum capital requirement of K104 million by K53 million, despite having raised over K100 million in 2016, which was aimed at recapitalizing the bank.
In December 2016, Investrust successfully raised over K100 million following an overwhelming approval by its shareholders to issue cumulative shares to Meanwood Financial Services Limited.
The bank had entered into a subscription agreement with Meanwood in which the bank was to issue 20,024 cumulative, redeemable, non-voting preference shares with a par value of K1 each at a subscription price of K5,000 each at an Extraordinary General Meeting (EGM) of Investrust shareholders.
That extra capital at the time should have meant that Investrust complied with the BoZ’s minimum primary capital requirement for local banks.