Ailing Hwange Colliery Company Limited (HCCL) has announced its voluntary suspension from the London Stock Exchange (LSE) with effect from Monday this week.
In a notice seen by Great Dyke News 24, the suspension was approved by the Financial Conduct Authority effective from 10 February 2020.
“Hwange wishes to advise shareholders that following the suspension of trade on the JSE that has been in force since November 2018, it has successfully requested that the FCA (Financial Conduct Authority) in the UK suspend its listing on the UK Official List, which suspension also suspends Hwange’s trading on the London Stock Exchange.
“The request for suspension was approved by the FCA on 10 February 2020, with the suspension effective from 10 February 2020. Shareholders will be updated in due course,” reads the statement.
The temporary suspension of the company on the LSE comes after the firm was suspended in 2018 from trading on the Zimbabwe Stock Exchange (ZSE) and the Johannesburg Stock Exchange (JSE) after it adopted a reconstruction path.
The government, the biggest shareholder in Hwange with 36.7 percent, defended the decision to place Hwange under reconstruction saying the move was aimed at saving its assets from creditors.
The company’s cost of production was greater than its sales revenues at the time.
Hwange owed the government US$150 million and Mota Engile US$42 million at the time.
British tycoon Nicholas van Hoogstraten, who holds 31 percent shares in Hwange, opposed the reconstruction which places the company under a government-appointed administrator. He had offered to buy out the government’s shares with a US$70 million offer, but it was rejected.
Meanwhile, HCCL in the first half year of 2019 posted a profit of $3,5 million recovering from a loss of $23 million recorded in the previous year.