By Business Correspondent
Harare – National Foods, the nation’s leading food producer, has announced its intention to delist from the Victoria Falls Stock Exchange (VFEX).
The decision comes as the company no longer requires additional capital from public equity markets.
The VFEX, launched in 2020, was initially envisioned as a platform for companies to raise US dollars to fund growth and expansion.
However, persistent liquidity challenges have hindered its success, prompting many listed firms to reconsider their presence on the exchange.
Natfoods, renowned for its popular brands including Gloria, Red Seal, Pearlenta, and BetterBuy, will transition to a private company by buying out existing shareholders.
The company cited the high costs associated with maintaining a public listing, coupled with the limited liquidity and trading activity on the VFEX, as key factors driving the decision.
“The company no longer requires capital from public equity markets in the near term, reducing the advantages of maintaining a VFEX listing.
“The delisting will enable National Foods to redirect spending on substantial regulatory and compliance expenses to initiatives that are more closely aligned with the company’s needs,” National Foods says in a circular.
Innscor Africa and South Africa’s Tiger Brands are the majority shareholders of Natfoods, each holding a 37.45% stake.
Since 2021, Innscor has invested over US$160 million in expansion projects, primarily benefiting Natfoods.
These investments have included a new bread factory in Bulawayo, a state-of-the-art flour mill, a pasta and biscuit production line in Harare, and the launch of a new breakfast cereal range, NutriActive.
The delisting is expected to provide National Foods with greater operational flexibility, allowing it to streamline processes and focus on its core business without the constraints of public market regulations.
Additionally, the company anticipates significant cost savings from reduced compliance fees.
National Foods’ prepared exit from VFEX underscores the ongoing challenges faced by the Zimbabwean stock market and highlights the need for more robust measures to attract and retain investors.
