Trustco Group Holdings appears to be having second thoughts about its long-standing threat to delist from the Johannesburg Stock Exchange (JSE).
This comes nearly five years after first announcing the potential move.
Last year was not the first time the company threatened to exit Africa’s largest bourse. In 2021, Trustco announced it had received shareholder approval to delist and seek a listing elsewhere.
Delisting from the JSE would also result in the diversified group delisting from the Namibia Securities Exchange (NSX), where it holds a secondary listing.
The tension stems from Trustco’s accusations that the JSE has undermined the independence, accountability, and integrity of its board by questioning its financial statements.
However, a new announcement from Trustco on Monday indicates the company is re-evaluating whether delisting remains appropriate following the JSE’s approval of its simplified listing requirements.
“As previously communicated, the board of directors of Trustco has been considering the appropriateness of a delisting of the company’s securities.
The board is assessing the potential effect of these revised listing requirements … including whether and to what extent such requirements may impact the considerations underlying the potential delisting,” the company’s statement reads.
Until a further announcement is made, the board has advised shareholders to continue exercising caution when dealing in Trustco’s securities.
SIX-YEAR CONFLICT
The JSE has been at odds with Trustco for the last six years, a conflict that began in late 2020.
At the time, the JSE found that Trustco had failed to comply with listing requirements regarding its annual financial statements for the year ended 31 March 2019, and interim results for the six months ended on 30 September 2019.
The JSE directed Trustco to rectify these discrepancies, claiming it found errors that inflated Trustco’s profits by a combined N$2.1 billion, but Trustco refused claiming all its financial results were up to standard.
The dispute escalated in 2022 when the JSE suspended trading of Trustco shares. Trustco then agreed to correct the financial statements.
The JSE on Monday received approval from the Financial Sector Conduct Authority for its simplification project, which aims to streamline listing requirements.
It says the new requirements use plain language to record concise regulatory objectives, removing ambiguity and duplication while reducing overall complexity.
“The approval and forthcoming implementation of the simplified listings requirements form part of the JSE’s broader strategic drive to create an enabling environment that attracts and retains listings, while upholding transparency and investor protection,” the JSE says.
The new rules will replace the previous version in its entirety and will come into force for existing issuers on 16 February.
Key changes include reduction in the voting threshold for share issues and buy-backs from 75% to 50% and an increase in ordinary course of business thresholds from 30% to 50%, allowing companies more room to operate without seeking constant shareholder approval.
Trustco currently remains listed on the NSX and the Over-the-CounterQX Best Market in the United States.
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