BY BUSINESS REPORTER
The offer by the equity firm was endorsed by THL’s shareholders at an extraordinary general meeting (EGM) in Harare yesterday.
The transaction is subject to valuation, which will be done on the group’s assets.
The EGM heard yesterday that Capital Seven would inject $12,5 million into THL, effectively diluting current shareholders to 25%. This will earn the investor 60% of THL.
The investor has also agreed to meet related costs of the transaction. The costs include legal, valuation and publicity, among others, which will earn them an extra 15%.
Capital Seven has already started paying for some of the costs in good faith, THL chief executive officer William Nyemba told shareholders.
Nyemba said at the end of the transaction, part of the $12,5m would be used to pay off THL’s minorities or shareholders, who want to opt out completely.
He said a board resolution had already been passed blessing the proposal by Capital Seven. Capital Seven’s investors were mainly from the Far East.
Nyemba said the transaction would safeguard THL’s assets. THL’s prime asset, Trust Banking Corporation, is currently under liquidation and some of its assets were auctioned to pay off creditors.
He said the Botswana-domiciled firm had initially wanted to acquire the group for $25 million, but later revised the offer to $12,5 million after the bank was closed.
Nyemba said Capital Seven had also bought into THL’s idea of venturing into merchant banking.
“The investor is keen on merchant banking and property development. We are looking forward to working with them to develop these two areas,” he said.