Lonrho African Holdings has disposed its stake in Lonrho Fresh Exports Zimbabwe (LFEZ) to its indigenous partner Edwin Moyo as part of a new strategy which will see the group transition from the focus on horticulture processing to food processing and value added production.
Lonrho holds a 49 percent stake in LFEZ while Moyo holds the remaining 51 percent. The transaction was signed last week.
Lonrho acquired the stake after it took over the operations of Rollex Holdings in South Africa from the De Robillard Family in 2010. After that, in October 2013, a consortium led by Rainer-Marc Frey and Thomas Schmidheiny, two Swiss entrepreneurs, made a public take-over bid for 100 percent of the share capital of Lonrho, and took control on July 19, 2013.
The acquisition included the subsidiary company Rollex Private Limited, holding the Fresh Exports business and logistics operations in Zimbabwe, which in early 2013, was renamed Lonrho Fresh Exports Zimbabwe Private Limited with Lonrho Logistics Private Limited registered as a separate entity with the key focus on expanding and building its export logistics capability.
However, after substantial investment of US$50 million in Zimbabwe, Lonrho together with Moyo, who is the LFEZ chairman agreed to start the negotiation process that will transition the export business to a wholly owned Zimbabwean company.
Newly appointed Lonrho chief executive Roland Decovert told The Herald Business in an interview from his base in Johannesburg, South Africa, that the group was changing its priority from horticulture to agro-processing.
“What you see today is just a change of priority considering that we have invested close to $50 million in Zimbabwe.
“Our conclusion was that we have to focus on food processing and move away from agriculture and we agreed with the current chairman that he takes over the business.”
Decovert said the group would focus on building factories which will take up and support local farm produce.
“We will be looking at food processing factories for both the local and export markets but we will come with a clear announcement in the next few months.
“We will also develop our logistics business and use Harare as a logistics hub for Southern Africa, it is ideally positioned for that.”
The group will also support LFEZ through its logistics division, Lonrho Logistics.
Lonrho began operating in Africa in 1909 as the London and Rhodesian Mining Company. The late Tiny Rowland took Lonrho’s helm in 1961 and subsequently transformed it into a worldwide conglomerate. It has investments in 11 other African countries.
“So after divesting out of mining and now horticulture, food processing, supply chain and distribution, dealership and infrastructure will be the backbone of the group’s expansion strategy going forward,” said Decovert.
The group also has ports in some parts of West Africa which fall under the infrastructure division. He said Lonrho remains committed towards investing in the growth of Africa and Zimbabwe specifically.
Moyo said he will remain as chairman of the company but it will now change its name to Nhimbe Fresh Exports. He said that the focus of the business would be on high value crops for the UK export market.
“We are putting up 200 hectares of blueberries for the Tesco group of supermarkets and 82ha of stone fruit as part of the strategy of high value crops,” Moyo said, adding that they would also plant blackberries and raspberries, crops that the company has exclusive breeder rights for.
Nhimbe would also continue with its tobacco and pea programmes while providing vegetables for regional chains such as Pick ‘n’ Pay and Food Lovers.
Author: Staff writer