Government has confirmed that Boustead Beef Private Limited will take over the perations of Cold Storage Company (CSC) on a 25-year concession.
Addressing a post cabinet press conference in Harare today, the Minister of Information Monica Mutsvangwa said the development came after a presentation by Ministry of Finance in Cabinet in which the foreign company will “raise and invest $135 million into CSC over five years, being for both capital expenditures and working capital for the business.”
Under the deal, Boustead Beef will pay off CSC financial debts totalling US$42 530 597, pay rentals of US$100 000 per annum for the first five years of the concession agreement, while taking over and run ranches and abbatoirs for initial period of 25 years.
Some of CSC’s ranches are located in Dubane, Umguza, Mushandike, Darwendale, with abbatoirs in Bulawayo, Chinhoyi, Masvingo, Marondera, and Kadoma.
“The benefits to accrue to Zimbabwe from the investment agreement include increased capacity utilization at the ranches and abattoir plants, increased prospects for the restoration of the enterprise’s viability and higher throughout; stemming of further deterioration of equipment which is currently lying idle, and the growth of the local livestock and beef industry,” Mutsvangwa said.
Finance minister Mthuli Ncube defended the long lease of 25 years.
“That’s the ideal timeline for any international concession because it is debt funded and during that period Boustead will be able to recoup and CSC will bounce back in the process. The company will also create employment and export to countries such as China and Angola. We are satisfied that they will bring glory to CSC. They have since started paying the workers’ salaries since February this year,” said Ncube.
Meanwhile, Ncube has said the government is targeting on cashing in at least $250 million after it decided to recapitalize and partially privatize the public bus company.
Ncube said they were initially expecting 800 buses from Belarus, China and South Africa.
“A total of 39 buses are already in the country as part of the ZUPCO fleet. We expect 500 buses from Belarus, 100 from China and South Africa to provide 200 more in our expected 3 000 fleet when in full flight. This is key to urbanisation and easy movement of people in urban areas. We are looking at raising $250 million through the sale of equity with the private investor getting 49% shareholding,” he said.