The annual general meeting of the local brewer, Sechaba Holdings, is expected to decide, among other things, the appointment of former legislator, Boyce Sebetela and former chief executive of Botswana Tourism Organisation, Myra Sekgororoane to the board of the company.
Barclays Bank Botswana Financial Director, Lipalisa Makepe, has also joined the board along Montle Phuthego and Sechaba’s newly appointed financial director Gert Nel.
The AGM, slated for the end of November will likely touch base with the board’s proposed changes to the company’s corporate structure.
The company said on Thursday that its board of Directors is “still assessing the full impact of certain corporate change proposals that if embarked upon and successfully implemented, may have an effect on the price at which the Company’s securities trade”.
In July this year, KBL managing director executives ended the speculation that their holding company, Sechaba Brewery Holdings Limited (SBHL), is toying with the idea of de-listing from the Botswana Stock Exchange (BSE) as a response to government’s continued imposition of the alcohol levy and traditional beer regulations.
Despite his assurance of staying put in the domestic market, De Kock however once again presented a gruesome picture of a company that was struggling to stay afloat, empower Batswana and create employment in the face of dwindling profit margins occasioned by mounting hostility from government.
Over the years, government has repeatedly reviewed and increased the levy and it rose from an initial 30 percent in 2008 to 50 percent by December last year.
While Sechaba was still smarting from compressed profit margins due to the levy, government delivered a double whammy when President Ian Khama introduced Traditional Beer Regulations effective July 2013.
The regulations, which have been described as more harmful than the alcohol levy, barred traditional beer sellers from operating their businesses from their homesteads, particularly the selling of Chibuku.
One of the world’s largest brewers, SABMiller Plc, the second biggest shareholder of Sechaba has management control in the company’s operating company, Kgalagadi Breweries.
KBL, as known locally, has over the years benefited considerably from SABMiller’s insight and experience with regard to management, technical expertise, brand building and distribution expertise.
It is not yet clear how the roping in of Sebetela, Sekgororoane and Gert Nel will help speeding up the corporate structure change that the board intends to make.
Sunday Standard has however established that so far, initial discussions on the matter have been held with a limited number of key shareholders, including amongst them the BDC and SAB Miller.
Apart from delisting from BSE, observers have since suggested that SABMiller might have made a proposal to buy BDC out of the company.
However, Jono Waters, publisher of the Central African Stock Exchanges Case Handbook, says that it is highly unlikely that BDC would buy into the idea of selling its stake to SAB Miller. The publisher also said that ‘chances are very slim’ that Sechaba will de-list especially that the local exchange craves liquidity.
“While SAB Miller may want to delist the group, government through the BDC, is ironically the second biggest shareholder and may well block this. It is unlikely the BDC would sell to SAB Miller, leaving the multinational to export products from SA,” Waters said.
