Shares in diamond company Trans Hex soared almost 13% after announcing its intention to buy out minority shareholders and delist the company.
Trans Hex said the proposed transaction will enable it to “save on the costs of operating in a regulated environment, particularly as the board believes that the listing provides little benefit to the company at this stage of its operating cycle”.
Trans Hex plans to offer the shareholders, excluding the Cream Magenta 140, Metcap 14 and RAC Investment Holdings who collectively hold 79.73%, R1 per share.
The share price closed at 88c.
At the end of June, Trans Hex posted an operating loss for the year to March, an indication that the group is facing deep financial difficulties. Its liabilities of R315m far exceeded its assets of R137m.
Trans Hex posted a R144m profit for the year to end-March 2019 compared with a R229m loss the previous year, but this profit came from sources outside its operations, with a R111m benefit stemming from a “remeasurement of rehabilitation provision” playing a major role.