LIQUIDATED SWAZI SPA’S E41.9M OUTSTANDING SHARES

MBABANE – Recently liquidated Swazi Spa Holdings’ market capitalisation is said to be over E41.9 million.

About a week ago, the High Court of Eswatini issued a final order for the liquidation of five companies under Sun International Management Limited. Liquidation means that the business is not able to pay its debts. It further implies that the business will cease to operate (generally as a result of financial problems). The court had previously issued an interim order placing the companies under provisional liquidation. Judge Cyril Maphanga issued a final order for liquidation of the companies.

Companies

The affected companies include Eswatini Stock Exchange-listed Swazi Spa Holdings, which was operating SwaziSpa Hotel and Casino, Lugogo Sun and the Ezulwini Sun. Figures sourced from the Eswatini Stock Exchange show that Swazi Spa Holdings’ market capitalisation is E41 966 964. Market capitalisation refers to how much a company is worth as determined by the stock market. It is defined as the total market value of all outstanding shares. Shares outstanding refer to a company’s stock currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders. According to Investopedia, any authorised shares that are held by or sold to a corporation’s shareholders, exclusive of treasury stock which is held by the company itself, are known as outstanding shares. The fate of these shares is expected to be known this week, as liquidator of the companies lawyer Marisa Boxshall Smith is set to meet with stock exchange officials.

Powers

The court appointed the lawyer as the provisional liquidator of the five companies inclusive, with all powers, direct and ancillary to the joint winding up of the companies. She confirmed the planned meeting in an interview in the past week. Usually, when a publicly-listed company ceases operations and goes into liquidation, the company’s shareholders may be entitled to a portion of the assets, depending on the type of shares they hold. However, the stock itself is usually worthless. If a company has shut its doors for good, its assets will be sold and the entire proceeds will be distributed to its creditors in a strict order of precedence.

Assets

The common shareholders may, at best, get a portion of their value back when the assets are distributed. The amount of the payment a common shareholder will receive is based on the proportion of ownership they have in the bankrupt firm. Swazi Spa, on the other hand, is one of only eight companies listed on the country’s stock exchange.

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