ZIMBABWE Law and Practice Contributed by: George Gapu, Fidelis Manyuchi and Tapiwa John Chivanga, Scanlen & Holderness
• takeovers and mergers; • termination of listings at the issuer’s request; • transfer of listings; • trustee deeds or their amendments; or • any other document bearing the logo of a sponsor - ing broker. 7.3 Producing Financial Statements For transactions between private entities, the require - ment to produce financial statements for bidders is usually negotiated between the parties. For transac - tions involving a public company, these statements must be prepared for the purpose of circulating them with the shareholders, and they must be in accord - ance with the standards set in the Companies and Other Business Entities Act (Chapter 24:31). 7.4 Transaction Documents Two or more public companies, or any combination of companies consisting of at least one public company and at least one private company (hereafter called the “merging companies”), may undertake a merger sub - ject to disclosing the following documents. • A notice of the proposed merger in the gazette, and in a daily newspaper circulating in the dis - trict in which the registered office of the company is situated, making mention of the names of the merging companies. • A notice of the provisional contract of merger to the shareholders of each of the merging companies, which shall be compliant with the requirements for a special resolution and shall be accompanied by: (a) a copy of the contract for merger together with an explanation of the legal and economic grounds for the merger; (b) any recommendation of the board of directors on the proposed merger and the reasons for the recommendation; (c) a copy of an opinion of an independent finan - cial adviser if such an opinion has been ob - tained – and more specifically if the company is a public company; and (d) the annual financial statements of all the companies which are parties to the merger for the previous three years (or any shorter time of the company’s existence) (i) provided the latest annual financial statement was, as of a
date more than six months before the contract for merger, an audited financial statement for the intervening period ending not less than one month before the shareholder meeting con - cerned, and which reflects the financial condi - tion of the company concerned (except that the foregoing shall not apply to any new company that was created to be the surviving company in the merger) and (ii) a notice that in the event that the merger is approved, dissenting share - holders are entitled to certain rights, referred to as the “dissenting shareholders’ appraisal rights”. In addition, not later than 14 days after the approval of the merger by the last shareholder meeting to approve it, the merged company or the merging companies, as the case may be, shall: • file the contract for merger with the Registrar in the prescribed manner and form, together with the pre - scribed fee, upon which the merger shall become effective; and • publish notice of the merger in the gazette, and in a daily newspaper circulating in the district in which the registered office of the company is situ - ated, making mention of the names of the merging companies. For both private and public companies, certain docu - ments will also have to be disclosed to regulatory authorities, such as the Zimbabwe Revenue Authority for tax assessment purposes and the Competition and Tariff Commission in instances of notifiable mergers. These include: • the merger agreement(s) and the resolutions thereto; • a report clearly outlining the effects of the pro - posed merger on competition; • copies of annual reports and financial statements of the previous year; and • any documents relevant to the proposed merger. All details concerning the transaction and the docu - mentation relating to it may also be disclosed and/or requested. The required details are:
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