West Properties, a Zimbabwean property developer, has listed on the Victoria Falls Stock Exchange (VFEX) on the 5th of May 2023. The company’s listing is expected to provide it with access to a broader pool of investors, enabling it to raise capital for strategic growth initiatives and expand its market share. Furthermore, listing on the VFEX will provide the company with increased visibility and credibility. This will enhance its brand and opening up opportunities for strategic partnerships and collaborations.
The Victoria Falls Stock Exchange (VFEX) is a small stock exchange headquartered in Victoria Falls, Zimbabwe. It was established in 2020 as a subsidiary of the Zimbabwe Stock Exchange (ZSE) to operate in the Victoria Falls special economic zone. The VFEX is expected to attract foreign investors and provide them with an opportunity to invest in Zimbabwean companies. The VFEX is also expected to provide a platform for Zimbabwean companies to raise capital and expand their operations. The benefits of buying shares on the Victoria Falls Stock Exchange include access to foreign currency dividends, capital gains and capital repatriation.
West Properties listing shows their commitment towards enhancing their growth prospects and increasing investor confidence in the country. West Properties founder and chief executive Ken Sharpe described the road to listing as an interesting journey for the company as it earmarks to put 1 billion bricks by 2050.
“We are just over 57m bricks. That makes us have confidence and belief because six percent of the billion brick journey has already been achieved. We won’t stop until our vision is realised. I would like to thank all stakeholders for their dedication, commitment on this journey,” he said.
“We have perfomed to date and made promises to the market that we have kept. Need to build on time and built quality buildings on a budget. Build more excellent projects and have confidence in the country and believing in the future.
WEST PROPERTIES PLUS FOR DESTINATION MARKETING
The listing is also expected to benefit Zimbabwe’s destination marketing efforts. As a leading player in the Zimbabwean property market, West Properties can deliver exceptional value not only to its investors but also to the tourism industry. The development of Warren Hills Golf Estate unlocks new growth for tourism development opportunities. With hindsight of only two PGA Golf courses in Africa, the Warren Hills Estate PGA Golf course can unlock new tourism opportunities for Zimbabwe.
The West Properties Board Chairman Dr. Micheal Louis confidentanly said this is huge for the country’s tourism. “More confidence in the Warren Hills PGA GOLF, as you may know there are only 2 PGA Golf Courses in Africa, can you imagine the tourism DEPTH towards the destination. Tourists coming into Harare, Zimbabwe enroute to the Vic Falls.”
“The Market wants to see this confidence with business leaders like Ken who chose Zim as his destination,” added Dr. Louis.
The VFEX has already witnessed significant interest from local and international investors thanks to its unique value proposition and the potential for attractive returns. The listing is expected to further expand the pool of investment opportunities available on the VFEX, which has rapidly emerged as one of the most attractive investment destinations in the African region.
“I really like the VFEX as a very creative instrument for diaspora and international people to invest in. People I am dealing with are extremely exited to trade in hard currency USDs, because of the limited taxes, fees are little and the market is liking the creative ability of the VFEX,” the WestProp board chair went on.
According to West Properties, the IPO is to raise capital to accelerate the development of ongoing projects that include Pokugara Residential Estate, Millennium Heights, Pomona City, The Mall of Zimbabwe, Millennium Heights Office Park, and the Warren Hills Golf Estate. Mr. Ken Sharpe said the preferential shares allow investors a period of 5 years before they decide to become ordinary shareholders, a period during which they will benefit from a minimum guaranteed return of 7,5 percent per year as well as dividends from the company’s profits.
The company has established a strong reputation for delivering high-quality properties that meet the diverse needs of its clients. It received approval to list the two categories of its share capital, namely its ordinary shares and preference shares. The company intends to issue up to 5,400,000 convertible redeemable participating preference shares at a price of US$5 each, representing an aggregate amount of up to US$27 million.
VFEX board chairman Caroline Sandura said the listing marks a new chapter for WestProp as they go public after having been a private company.
“Listing on the VFEX is a monumental way to begin a new chapter as a public company. West Properties will enjoy the benefits offered by the bourse such as the ability to raise capital in hard currency, tax incentives, lower trading fees for investors, valuation and reporting made easier and strategic listing and placement given the VFEX is earmarked to sit in the offshore financial services centre hence visibility to the international community,” Sandura said.
It intends to issue up to 1 million ordinaryshares at a price of US$10 each, representing an aggregate amount of up to US$10 million bringing the cumulative amount to US$37 million. The minimum subscription of shares has been pegged at US$50 (10 shares) for preference shares at US$5 each, while ordinary shares at US$100 (10 shares) at US$10 each.
The timing of the listing has been carefully selected, taking into account various market factors and the current economic climate in Zimbabwe. The VFEX, which was launched in 2020, has already witnessed significant interest from local and international investors, thanks to its unique value proposition and the potential for attractive returns.
This is happening at a time the Government is positioning the VFEX to compete on a global scale by attracting quality listings. It will also further expand the pool of investment opportunities available on the VFEX, which has rapidly emerged as one of the most attractive investment destinations in the African region.
The Zimbabwean government is committed that the VFEX will remain a foreign exchange market in line with its Vision 2030, to be a middle income enconomy, which requires a lot of foreign investment as the country needs a vehicle that will make it attractive to foreign investors hence the VFEX, which has tax benefits.
Investing in Zimbabwe
Zimbabwe is strategically located at the heart of Southern Africa, making it land linked through the North-South Corridor which connects the Southern African Countries. This has made the country a regional logistics hub supported by railways, roads, power and telecommunications. Zimbabwe is one of the countries in the world with 60 tradable minerals and top important minerals such as gold, platinum, diamond, coal and nickel. The country’s diversified economy makes it an attractive destination for investment. The country’s incentives to attract foreign direct investment (FDI) include tax breaks for new investment by foreign and domestic companies and allowing capital expenditures on new factories, machinery, and improvements to be fully tax deductible. The government also waives import taxes and surtaxes on capital equipment.
