REIZ 2015 Net Profit Increases 953% Y/Y to K453M on Accounting Adjustment as it Mulls Offers for Majority Stake
Real Estate Investments Zambia (LuSE: REIZ) saw net profit rise by a multiple of 10 year-on-year (y/y) in 2015 to K453 million. Earnings per share came in at K8.02 (K0.75 in 2014):
Atlas Mara in talks to buy Finance Bank Zambia
Atlas Mara Ltd., the company co-founded by Bob Diamond to invest in African financial businesses, is in talks to buy Finance Bank Zambia Plc, according to three people with knowledge of the matter. Negotiations began as early as March, two of the people said, asking not to be identified because they’re not authorized to comment on the talks. (Read more)
Moody’s affirms Zambia rating at B1, downgrades outlook to negative
Moody's Investors Service ("Moody's") has today affirmed Zambia's B1 government bond rating and changed the outlook to negative. The key drivers for the negative outlook are:
- Deteriorating debt metrics, as evidenced by a rapidly rising debt burden and increasing debt servicing costs;
- A trend of missed fiscal targets that points to high execution risks in current deficit reduction plan to arrest the upward debt trajectory, particularly amid spending pressures in the lead up to next year's presidential election;
- The shift of the current account into deficit, removing a key credit support that has historically suppressed external vulnerability. (Read more)
Zambeef (LUSE: ZAMBEEF) announced that it is set to sell its Edible Oils unit ‘Zamanita’ to Cargill Holdings BV in an all-cash deal for K167 million ($25.7 M). The cash sum will be adjusted for estimated closing working capital less estimated net financial debt. The deal is scheduled for completion at the later of 1 May 2015 or first day of the month following the satisfaction of conditions of the transaction. Pangaea Securities is the sponsoring broker and adviser on the deal. Zamanita is one of the largest edible oils plants in Zambia with a crushing capacity of 100,000 MT of oil seed.
Guy Scott U-turns on firing of party Secretary General Edgar Lungu
Patriotic Front (PF) interim president Guy Scott dismissed Secretary General Edgar Lungu then quickly reversed his decision as protests broke out in various parts of the capital and pressure increased from Cabinet and the PF Central Committee. The PF Central Committee will convene sometime after the burial of late President Michael Sata next week to hash out any positional conflicts.
2015 National Budget unleashed!
The Minister of Financed announced the K46.7 billion 2015 National Budget yesterday in front of a packed parliament. 75 percent of it will be financed by tax revenue, 22 percent by debt and 3 percent by grants.
TAZARA receives $80m cash injection
The Governments of Zambia and Tanzania (the equal owners of TAZARA), are set to inject $80m into the operations of TAZARA over the next 12 months. 11.5% of the amount will immediately be allocated toward paying two months of employee salary arrears as well as some working capital.
First Quantum Minerals acquires Argentina's Lumina Copper Corporation
Canadian mining giant First Quantum Minerals (FQM) acquired Lumina Copper of Argentina in a $470m dollar cash and stock deal. The $10 per share cash portion of the deal will represent a 28% premium over Lumina'sJune 16 2014 closing price on the TSX Venture Exchange. The project will boost copper production to over 1.3 million MT by 2021. This is FQM's second acquisition in the space of 15 months after completing the the Inmet Corporation deal in 2013.
Zambia issues $1bn dollar bond
The government issued a second successful offering albeit at steeper conditions than the debut bond. The funds have been pledged to the transport and energy sector but with no specifics as of yet. What is most important now is the execution - this money needs to be put to work efficiently, more efficiently than the pace at which the $750m was utilized. The quicker the projects are done the quicker the pay-back period will be...
Batoka Energy Holdings (Ireland) Ltd is set to make a mandatory offer of K526.2m (K0.6746 per share) to Copperbelt Energy Corp. minority shareholders after acquiring 40% of Zambia Energy Corp. (ZECL) as part of a reorganization of ZECL announced in a cautionary note in Q4 2013. The 40% was previously held by institutional and retail investors. Here’s a chart showing the owner-subsidiary relationships before this change:
Trying to decipher this puzzle that is Zambia by using a variety of publicly available data (structured and unstructured) in conjunction with my own skill/experience. * * *