Nelson Gahadza Senior Business Reporter
Padenga Holdings shareholders have given the company greenlight to acquire the remaining 49.9 percent shares in Dallaglio Investments and gain full control as part of its scheme of reconstruction and restructuring.
All resolutions regarding the scheme of reconstruction and restructuring of Padenga Holdings were approved at a shareholder extra-ordinary general meeting held on August 16, 2023.
Currently, Dallaglio is 50.1 percent owned by Victoria Falls Stock Exchange (VFEX) listed Padenga Holdings, and its assets include Pickstone and Peerless mines, Giant Gold Mining Claims and Blue Rock Claims.
In a statement, Padenga said the approved transaction will be achieved by way of a share swap through the acquisition by Padenga Holdings Limited of 8,982 Dallaglio Investments (Private) Limited shares.
This represents 49.9 percent of the equity shareholding in Dallaglio Investments (Private) Limited in exchange for the issuance of 253,003,361 Padenga Holdings Limited ordinary shares listed on the Victoria Falls Stock Exchange and incorporated.
The EGM also approved placing the balance of the authorized unissued shares of the company, after the share swap transaction with the Dallaglio minorities, under the control of the directors. According to Padenga, the transaction was considered and identified as a potential opportunity for the restructuring of the group following the acquisition of 50.1 percent of the issued share capital in Dallaglio in 2019.
The negotiated value of the acquisition of Dallaglio is to be settled through the issuance of 253,003,361 Padenga ordinary shares that are listed on the VFEX to the Dallaglio Minorities or their nominees.
Mr Themba Sibanda, the group’s chairman, said in a circular recently that the acquisition transaction will result in the group having full control of the mining business and its investments, resulting in the alignment of its operations with Padenga’s objectives.
He said Dallaglio’s profits would fully accrue to Padenga’s shareholders, potentially improving the company’s bottom line and therefore increasing Padenga’s consolidated earnings per share.
“The proposed structure would result in Padenga having a larger asset base that could be leveraged for capital raising for expansion,” he said.
Mr Sibanda added that the new consolidated entity is anticipated to trade at a higher value than the current one, resulting in increased value for Padenga shareholders.
“Resultantly, the execution of the acquisition of the remaining issued shares in Dallaglio would result in great value for Padenga shareholders,” he said. According to the circular, since the acquisition of 50.1 percent of Dallaglio in 2019, there have been multiple positive developments within Dallaglio.
Part of the developments include gold production, which has more than doubled, reaching 1,961 kg in 2022, up from 632 kg in 2019.
In 2021, Eureka Mine, one of the largest and most technologically advanced gold mines in Zimbabwe, was commissioned by President Mnangagwa.
“Extensive expansionary expenditure has been underway, and the gold price has been rallying, whose combined effect is expected to result in significant increases in profits over the next few years,” the company said.
On successful completion of the transaction, Dallaglio will become a wholly owned subsidiary of Padenga, and Padenga will remain listed on the VFEX.