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Regional seed producer Seed Co Limited is seeking $ 19 million through partial unbundling, which will also result in separate listings of its regional operations.
Seed producer wants to unbundle 71% of Seed Co International represented by 242 million common shares
According to a circular, Seed Co will request shareholder approval for the proposed transaction at its meeting Annual General Meeting to be held next month.
The proposed transaction is intended to mobilize capital, defend investments already made in the region and finance other opportunities for expansion, through a structure that will also unlock and preserve value for money. shareholders while offering a direct geographic choice to investors. growth trajectory and the need to unlock, preserve and increase shareholder value, the directors propose to partially unbundle ha cash dividend, and separately enumerate on the BSE regional group operations that are owned by Seed Co International .
"The proposed separate listing of Seed Co International will be preceded by a capital increase of $ 19.22 million by placement of Seed Co International Shares with Vilmorin & Cie SA, a related party, this capital increase is intended to meet the short and medium term financing needs of regional operations, "said Seed Co.
retains a 26% stake in Seed Co International
According to the circular, the producing company of seed has expansion projects that require immediate funding of $ 31 million.
Subject to shareholder approval, directors required permanent equity financing through the placement of 37,920 648 common shares of Seed Co International to be subscribed by Vilmorin & Cie, at a subscription price of $ 0.5069 per share. [19659011] "If approved by the shareholders, the The private placement will have a 10% dilutive effect on Seed Co International's shareholding structure after partial separation, "said Seed Co.
Seed Co operates in Botswana, Kenya, Malawi and Nigeria
. Group plans to maintain growth momentum favored by anticipated market share growth in key markets, particularly in East Africa, with the adoption of the hybrid variety on the rise in this region as well as input programs. Zambia, Zimbabwe and Malawi
Analysts at Akribos Research Services view the transaction as "rewarding".
"Overall, the transaction improves the equity history of Seed Co Limited given the visibility and potential for access to capital. We continue to view Seed Co as an attractive piece to become known in agriculture in sub-Saharan Africa.
"Our thesis is supported by the prospects for strong food demand in the region.The African countries and the partnership Limagrain are ready to unlock more value especially around research and development."
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