The Ghana Stock Exchange in some few months is expected to lose another company, PZ Cussons, which has opted to voluntarily de-list from the equity market.
PZ is one of the oldest and most highly capitalized companies on the country’s bourse and being a multinational of high pedigree has always been regarded as a blue chip. Its impending delisting is therefore being seen as equity investors and capital market regulators and operators alike as a major blow.
This is happening at a time when the GSE has been pushing for companies, especially multinationals to list on the bourse.
A notice issued by PZ Cussons Ghana Limited to the GSE on October 1, 2019, indicated that the de-listing is a special business agenda for its 61st Annual General Meeting to be held on November 11, 2019.
This section of the meeting would seek an approval of the de-listing of the company from the Ghana Stock Exchange.
The approval would give the Directors authorization to take all steps necessary to ensure a cost effective and well-managed de-listing of the Company; and ensure that the Company realizes the full benefits associated with a de-listing from the GSE.
In view of the latest development, some market analysts opine that it does not send a good signal, given that there have been push for more listing of multinationals on the bourse.
Information available from reliable sources inside PZ itself indicates that the reason for the de-listing has to do with efforts to revamp the company.
So far this year, the shares of PZ Cussons have traded between a high of GHc 0.41 and low of GHc 0.39, the price at which it is currently trading. the company has 168 million shares issued on the bourse with market capitalization of GHc 65.52 million.
Several companies have been delisted since mid-2017 including UT Bank in the wake of the revocation of its operating license by the Bank of Ghana, African Champion Industries Transaction Solutions Ghana and Golden Web, as well as Pioneer Kitchenware.
The last entirely voluntary delisting was that of Accra Brewery about a decade ago, the decision taken to facilitate a major investment programme for expansion, undertaken by its parent and majority shareholder, SAB Miller.
PZ sources claim that the impending delisting is due to similar circumstances. The GSE is currently suffering its longest bear market in its nearly three decade history making the chances of its minority shareholders agreeing to buy into a rights issue as unlikely as the likelihood of a successful share offer to the public.
GSB