Minority Shareholders Press Government to Offload Shares in Sunbird Tourism
MISALICO members vow to keep pushing for Sunbird privatization.
Blantyre, Malawi -Members of a group called Minority Shareholders of Listed Firms (MISALICO) have stated that they will not relent in their efforts to persuade the government to sell some of its interests in Sunbird Tourism plc (Sunbird), writes Steven Godfrey Mkweteza.
The secretary general for the grouping, Frank Harawa, told shareholders at the annual general meeting (AGM) of Sunbird Tourism plc in Blantyre on Monday that the government was shooting itself in the foot by holding shares in Sunbird Tourism.
"We have raised this issue several times now, but it seems our government is not taking any action towards it. But we will not relent until the government listens to us," said Harawa.
Harawa added that the government's reluctance to offload some shares in the oldest hospitality company was creating liquidity challenges on the local stock market.
"If the government continues holding shares in the company, then there will be a liquidity challenge as there will be no shares on the local market. The government should offload some shares on the market to the general public so as to narrow the huge demand gap," said Harawa.
He said the minority shareholders would make serious gains on the capital market if the issue was resolved and the share price was increased.
However, the chief executive officer (CEO) for Sunbird Tourism plc, Samson Mwale, said the issue needed lobbying and engagement between the shareholders.
"I cannot speak for the government, but what I know is that the government's position on this has not changed for years now. There is a need for proper strategies so as to convince the government to dilute shares. This may be through shareholder engagement," said Mwale.
On the 2022 financial performance for the company, Mwale presented that his company has registered a profit after tax of K3.1 billion, representing an increase of 307 percent from the 2021 profit of MK749 million.
He said the profitability was driven by improved revenue as a result of business rebounding through intensified marketing and strong cost containment measures.
Mwale said the positive performance has also led the company to declare and pay an interim dividend of K132 million, representing MK0.50 per share in respect of the year ended December 2022.
Sunbird Tourism plc is a publicly quoted enterprise, listed on the Malawi stock exchange in 2002.
The Malawi government is a major shareholder in the company, with 71 percent through the dormant Malawi Development Corporation (MDC). 15 percent of shares are owned by the Press Corporation, while 14 percent of the company is owned by members of the public.