eBusiness Weekly
Tapiwanashe Mangwiro
StarAfrica Corporation Limited says ‘do not see the changes’ in Tongaat Hulett Botswana (THB) affecting its shareholding.
This comes as Tongaat Hulett is poised to sell its investments in Zimbabwe, Mozambique and Botswana.
Since 2019, when a new management team discovered accounting errors and purported fraud, things have been bad for sugar giant Tongaat Hulett.
This has resulted in a R12 billion reversal in the company’s worth.
After being placed under business rescue in October of last year, Tongaat Hulett is about to choose a strategic equity partner and process is on final stages.
“At the moment, we have not been notified by the other partners as to the specific progress that they are making in disposing of their assets in South Africa, Mozambique and Zimbabwe,” Robson Nyabadza, the company’s chief executive officer, said.
Tanzania’s Kagera Sugar, which had put in a proposal of R3,56 billion, was named as the preferred bidder by the Business Rescue Practitioners in July of this year.
However, a ferocious publicity campaign and lobbying effort by two other bidders specifically ensued leading to tables overturning for Kagera.
One of the bidders was the Ministry of Finance, Economic Development and Investment Promotion’s Sovereign Wealth Fund.
The fund tried to bid for Tongaat’s Zimbabwe assets, but the BRPs rejected it because they didn’t want to split up the firm whose sugar operations in Botswana, Mozambique, and Zimbabwe are not in financial crisis.
In fact, analysts say a portion of the parent company’s problems are related to its inability to obtain earnings from Zimbabwe due to exchange control regulations.
The Tongaat Hulett Botswana associate recorded a profit of $958,1 million during the year ended 2023, with Starafrica’s share being $319,4 million.
StarAfrica posted a $1,2 billion inflation-adjusted after-tax loss in FY2023, a 174 percent decline from the 2022 comparative.
The counter closed its Tuesday session at $4.78 per share on the Zimbabwe Stock Exchange (ZSE).
