Published: 24 July 2025

Tanganda Tea Company Limited, Zimbabwe's largest horticultural firm, has abandoned its earlier plan to create and list a new class of ordinary shares on the Victoria Falls Stock Exchange (VFEX), marking a significant strategic shift.

Instead, the company will pursue a capital raise of US$8m  through a Renounceable Rights Offer on the Zimbabwe Stock Exchange (ZSE), reinforcing its preference for the more liquid and established local bourse.

The decision was confirmed by Tanganda's company secretary, Sharon Kodzanai, who stated: "There will no longer be a creation and secondary listing of the proposed Class A ordinary shares on the VFEX. The capital raise by way of a Renounceable Rights Offer to the existing ordinary shareholders in proportion to their shareholding in the Company to raise US$8m will be undertaken on the Zimbabwe Stock Exchange."

The move to cancel the VFEX listing comes amid persistent questions over the U.S. dollar-denominated exchange's viability and limited liquidity.

Since its launch, the VFEX has struggled to consistently attract strong investor participation, despite offering tax incentives and facilitating trades in hard currency.

For Tanganda, returning to the ZSE indicates a pragmatic choice to capitalise on investor familiarity, a well-established shareholder base, and deeper market activity. Analysts suggest the decision reflects a growing caution among Zimbabwean corporates evaluating the effectiveness of the VFEX platform under current macroeconomic conditions.

A Renounceable Rights Offer gives existing shareholders the right - but not the obligation - to buy additional shares at a predetermined price in proportion to their current holdings. These rights can also be sold or transferred, potentially enhancing market activity while avoiding significant dilution of existing equity or incurring high debt.

The US$8 million capital raise is expected to fund Tanganda's strategic initiatives, including infrastructure upgrades, production efficiency enhancements, and the expansion of its export markets. The company, known for its diversified portfolio of tea, coffee, macadamia nuts, avocados, and bottled spring water, is seeking to strengthen its regional and international competitiveness.

Tanganda was demerged from Meikles Limited and listed independently on the ZSE in 2022. Since then, it has positioned itself as a leading player in Zimbabwe's export-oriented horticulture sector, with vertically integrated operations spanning plantations, processing, and distribution.

The decision to remain on the ZSE and rely on shareholder-driven capital injection is being interpreted as a reaffirmation of investor trust and a calculated move in a volatile economic environment.

With the Rights Offer now imminent, market watchers will be keen to see how shareholders respond and whether the capital raise will translate into accelerated growth for one of Zimbabwe's most prominent agro-exporters.
- Business Times

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