28 Aug 2015

African Copper is to delist from the Botswana Stock Exchange (BSE) effective August 28

Information from the company which operates Mowana Mine says the BSE has granted them permission to delist its ordinary shares. The company in May decided to delist from both the BSE and AIM, Australian bourse.

An analyst with Motswedi Securities said the delisting was a subtraction from the BSE at a time when the local stock exchange was in the process of bringing new listings on board. He said it also comes after Banc ABC delisted from the bourse early this year.

Mr Juma said the delisting was not surprising since African Copper has been trading on very thin volumes just like other companies listed on the Foreign Equity Main Board. “In other words, African Copper had a smaller free float which at times led to the fluctuations of its share prices without any fundamental reasons,” he said.

He said it was therefore uneconomical for the company to continue with the BSE listing given the fees involved against a backdrop of a decline in copper prices on the international market. This also does not mean the investors would go home empty handed.

“The good news is that existing shareholders have been given an opportunity to offload their shares through their local stockbroker in Botswana, hence will be able to recover their investments in the company,” he said.

These sentiments are shared by African Copper directors who said in a statement released in May that given the small free float, there were no reasonable prospects to be able to use the listing to raise money from other investors. The company states that the low liquidity in its shares lead to volatility in the share price which the board of directors believes may distort any objective assessment of the company’s value.

Furthermore, the costs associated with listing are not justified and not in the best interests of the company and its shareholders.

African Copper says the cancellation means there would no longer be formal market mechanism enabling shareholders to trade their ordinary shares through the BSE, AIM or any other public stock market. The company will not be bound to announce material developments, interim or final results and will no longer be required to comply with the BSE rules or sponsoring a broker in the bourse.

Trading on the stock market has been flat for the counter which has 1 485 106 251 shares listed and a market capitalisation of P29.7 million. Ends