Private equity firm, Takura Capital, has seized control of starafricacorporation after acquiring a 58% stake in the consumer staples concern, Business Times can report.
The transaction is waiting for regulatory approval.
The controlling shareholding was held by the Zimbabwe Asset Management Corporation (Zamco) which had moved in 2017 and paid off banks that were closing in on the sugar processor.
Zamco, a special purpose vehicle created by the Reserve Bank of Zimbabwe in 2014 to deal with the problem of growing non-performing loans in the financial services sector, then converted the debt into equity.
Government pension fund, the National Social Security Authority is now the second largest shareholder in starafricacorporation, controlling 30.7% shareholding.
Zamco CEO Cosmas Kanhai told Business Times stake has been snapped up and awaiting regulatory approval.
“Takura Capital was a willing bidder but we are just waiting for regulatory approvals from Zimbabwe Stock Exchange and also approvals under the new Companies Act,” Kanhai said.
No official comment could be obtained from Takura Capital.
The acquisition of a controlling stake in the Zimbabwe Stock Exchange listed concern comes after it has turned the corner.
In its trading update for the quarter to December 31, 2021, sugar production and sales volumes at starafricacorporation business units Goldstar, increased 65% and 102% respectively compared to the previous quarter as production returned to normal.
However, for the nine months to December, production decreased 9.4% owing to critical power and water outages.
The firm’s other unit, Country Choice Foods, reported a 24% growth in sales volumes in the nine months to December 31, 2020 from prior comparable period.
“Production and sales of new products have started to increase significantly, with products such as peanut butter, honey and pre-mixes well underway in their development and market testing phases.
“These developments are expected to enhance the company’s market footprint locally and, in the region, increase capacity utilisation and spread its risk across multiple product lines,” company secretary for starafricacorporation Aldo Musemburi said.
He said the company also re-scheduled some of its legacy debts and, thereafter, managed to settle significant portions of amounts outstanding to the creditors.
This, it said, is expected to improve the gearing position and allow the firm to refocus funds on critical plant maintenance and upgrade, and to ultimately increase capacity utilisation.
Musemburi said the company has also maintained enough inventory quantities to hedge against any supply chain interruptions caused by the pandemic and continues to improve its liquidity and solvency position through prudent working capital management practices.
Takura has a clean record of rescuing struggling firms.
It revived Cairns and removed confectionery maker Lobels from the death bed.
Last month, the private equity firm took over agro-processor, Interfresh Limited