Investor injects US$400m into CSC

10 Mar, 2019 - 00:03 0 Views
Investor injects US$400m into CSC

The Sunday News

Dumisani Nsingo, Senior Business Reporter 

ONE of the biggest companies in the country, Cold Storage Company is back to life following an affirmed massive capital injection of US$400 million that will be spread over the next five years by its newly found strategic partner, Boustead Beef Zimbabwe.

The revival of the country’s biggest meat processor and marketer, which had been under operating for the past two decades, affirms Government commitment to revive the industry and the economy at large. The latest development dovetails to President Mnangagwa’s “Zimbabwe is Open for Business” mantra as more investors line up to exploit opportunities in the country.

Confirming the mega deal, Boustead Beef Zimbabwe managing director Mr Nick Havercroft said his company has entered into an agreement with the Government to buy into CSC. Already he said, machinery worth about US$16 million has been procured and is awaiting delivery to the company’s headquarters in Bulawayo. The company is also repairing infrastructure at CSC’s ranches. He said the company was looking forward to investing about $400 million in the next five years upon securing lucrative export markets.

“Over the first five years we were focused on US$130 million but we have secured more markets and we are focusing way over US$400 million over the next five years, a lot of that is obviously for securing the beef. We have very good finance, very good off takes for the beef export orders. Our focus is going to be higher than what we had actually planned so our investment is going to be bigger than what we had anticipated,” said Mr Havercroft.

Boustead Beef is being financed by various investors from the United Kingdom, America, Switzerland, Hong Kong and Australia, all having shareholding in the business. He said the company will also be putting in a US$3 million state-of-the-art Information Technology system for the whole process from the farmer right through to the product on the shelf.

CSC’s Bulawayo complex is the largest meat slaughtering facility in Africa and only trails Botswana Meat Commission in terms of the latest technologies. The company has set sights on purchasing a huge fleet of trucks for the collection of cattle as well as refrigerated trucks to ferry carcasses for exports.

“We have secured orders into Angola, Dubai and China, so with demand for the beef we are going to be increasing our investment from obviously what we thought it was going to be,” said Mr Havercroft.

He said the company was taking over the running of all CSC’s entities which include branches and abattoirs in Chinhoyi, Marondera and Masvingo including its other divisions, which include the Beef Canning factory and leather processing plant, Wet Blue Industries all located in Bulawayo as well as its ranches in Matabeleland and Masvingo.

He said the company was going to take over CSC’s legacy debt of which its biggest creditors are its employees due to unpaid salaries.

The meat processor’s debt is believed to be close to $100 million. He said the company was looking forward to re-employing a majority of the workers.

Mr Havercraft said the Government had been very supportive of the company’s initiative. Speaking after a tour of the CSC’s complex in Bulawayo last week CSC director of marketing Mr Isaiah Machingura confirmed that the investor had already procured part of the machinery for refurbishing the factory. He said the investor has started paying full salaries to employees as of February.

“Wages are being paid as of February onwards and there won’t be any stopover. More people are going to be employed for all the CSC branches. In operations we will be talking of slaughtering about 500 to 600 animals a day. It really needs a command of labour. We are talking of a lot of by-products that are going to be produced here for instance we have tallow, which will benefit local soap manufacturers instead of them importing,” he said.

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