Last week, joining the presidency in a nationwide effort to safeguard the health and wellbeing of all South Africans, the SAB Zenzele board announced its decision to reschedule the special AGM planned for March 19 2020 in Johannesburg, to March 25 with a digital voting system. This morning, Penuell Maduna, SAB Zenzele chairperson, announced that this meeting will now be postponed until further notice.
In a video address to retailers and shareholders, Maduna explained: “As you are all well aware by now, we are in the middle of a global pandemic, with Covid-19 currently present in more than 180 countries, affecting more than 300 000 people. This is a humanitarian, social and economic pandemic gripping all major economies around the world, with most countries implementing numerous measures to limit the movement and interaction between its citizens in order to safeguard the safety and wellness of their citizens. Social distancing is an attempt to curb the spread of the virus, but this comes at a significant economic cost and impacts individuals and companies alike. The major stock markets around the world, including the JSE, are experiencing extreme volatility, last seen during the global financial crisis in 2008.
“On March 15 the government instituted restrictions on all your businesses, limiting the sale of liquor to between 9am and 6pm. We understand what a significant impact this is having on your businesses, however, we urge you to adhere to the proposed restrictions,” he continued.
“It is against this backdrop that the board, at its special meeting this morning, unanimously decided to postpone the launch of the SAB Zenzele Kabili scheme. As a board, our responsibility is to consider the best interests of all Zenzele shareholders, and we believe that now is not the right time to be proposing a scheme where we are asking you to make a long-term investment decision, all things considered. Accordingly, the SAB Zenzele board has resolved to delay the shareholder vote and implementation of SAB Zenzele Kabili by up to one year, to take place when we are hopefully in a more stable market environment, or before March 31 2021.”
Answering the questions that may be on shareholders’ minds, he said: “The board has decided that each SAB Zenzele retailer shareholder will receive 77.5% of their entitlement from the SAB Zenzele unwind in the form of cash. This will proceed as closely as possible in accordance with the timelines communicated to you, in terms of which, your cash will be paid as closely as possible to the originally anticipated payment date of April 15 2020, and by the end of April 2020 at the latest.
“The balance of your entitlement will be retained to allow you a reinvestment opportunity into SAB Zenzele Kabili, when the Zenzele Board calls another general meeting to ask you to vote on the implementation of the new scheme. At this stage we cannot predict when this will happen, but the board is committing to you that this will happen before the end of March 2021.”
He concluded: “We are living in very challenging times, and again, the SAB Zenzele Board believes this is the right course of action to take at this time.”
Shareholders are advised to look out for further communications.
All shareholders are encouraged to join the SAB Zenzele retailers Facebook group: https://www.facebook.com/groups/181049256534071/ or to dial *120*1138# or visit www.investecsps.co.za for more information.