Message Mar 21 Oct 2014 10:00



ZCCM-IH-The Lusaka Stock Exchange (LuSE) is celebrating 20 years of its existence since its inception in 1994. The year 2014 is also special in that Zambia celebrates 50 years of her independence on Friday the 24th October, 2014. October is therefore a special month in Zambia as it galvanizes all Zambians to celebrate their political independence. This year Zambia has even more to smile about on the economic front as ZCCM –IH has declared its first dividend ever.

ZCCM-IH is the investments holding company majority owned by the Government of the Republic Zambia (GRZ) and holds minority equity interests in the successor mining companies created after the unbundling and privatization of Zambia Consolidated Copper Mines (ZCCM) in 2000.

ZCCM-IH is a public company listed on the LuSE. Its shares also trade on the Euronext stock exchange in Paris. Under the current shareholding structure, the Government of the Republic of Zambia (GRZ) holds 87.53 % whilst 12.47% is held by minority shareholders.

Following privatization of ZCCM in 2000, ZCCM-IH inherited debt of approximately USD 363 million on its balance sheet. And for the next ten years the company was technically insolvent – and therefore unable to pay any dividends to its shareholders on account of this legacy debt.
In 2013, ZCCM-IH undertook a major internal restructuring exercise to expunge the legacy debt from its balance sheet. This was done via a share rights offer.

Prior to the balance sheet clean up, the share price of ZCCM- IH on the LuSE was K12.50 on 2nd January, 2013.
After the successful rights offer of May 2014 and elimination of the legacy debt from the balance sheet, the price of ZCCM –IH shares on the LuSE has risen significantly and was K40 as at the beginning of October, 2014. This represents a capital gain of 220% over a period of 21 months.

With a clean balance sheet, ZCCM-IH is now in a position to declare and pay dividends to its shareholders based on the dividend revenues it receives from its investee companies and operating subsidiaries. The big news and event is therefore that for the first time ever ZCCM-IH has declared dividend – and at the AGM held on 7th October, 2014, shareholders approved a total dividend of K250 million which is approximately US$40 million .

Prospects for ZCCM-IH
With a market capitalization of US$ 1 billion, ZCCM-IH has reclaimed its rightful place and pole position as the company with the largest market capitalization on the LuSE. This is befitting, as mining is still the largest export earner for Zambia.
Going forward, there are some interesting and exciting developments. In the 2015 Zambia national budget, it has been announced that GRZ intends to scale down its shareholding in ZCCM-IH from 87.53% to 60%. This sell down of 27.53 % shareholding represents approximately US$ 270 million in current value terms. An interesting component of this sell down is that the shares will be sold to Zambian citizens as part of the overall drive to empower the citizenry.

The net effect is that the free float of ZCCM-IH will increase significantly from the current 12.47% to 40%. This ultimately should improve liquidity in the stock and on the LuSE as a whole and in turn unlock value for the benefit of all shareholders.
As Zambians await the release of ZCCM-IH shares as a preferential sale to the citizenry, this is truly a befitting jubilee celebration of 50 years of independence. ... -dividend/
Ce que l'on conçoit bien, s'énonce clairement, Et les mots pour le dire arrivent aisément. BOILEAU