Tanzania based firm acquires Tongaat Hullet’s Sugar assets – NewZimbabwe.com

By Alois Vinga

A Tanzania based firm has emerged as the preferred equity partner to purchase Tongaat Hullet’s sugar assets out of a list of eight possible suitors in the transaction.

Tongaat is a cane-growing, sugar milling and refining concern with operations throughout the Southern African region including Zimbabwe.

Market data shows that the company has four mills in South Africa with an installed capacity to produce more than 1 million tons of sugar per annum.

The embattled Tongaat which is currently suspended JSE-listed group opted for the move as part of a business rescue strategy amid reports of owing nine banks a whooping  R6,5 billion directly while the aggregate debt owed by farmers, haulers and other related companies in Tongaat’s ecosphere is estimated to be about R20 billion as at November 2022.

The latest strategy forged in October 2022 confirmed recently the proposed transaction with Tanzania’s Kagera Sugar will comprise the acquisition of its complete sugar division in South Africa as well as its sugar businesses in Zimbabwe, Mozambique, and Botswana.

However, the total amount involved in the transaction and plans to maintain the JSE listing going forward has not yet been revealed.

Kagera Sugar Managing Director, Nassor Seif told the media in Tanzania over the weekend that the latest acquisition was in line with the group’s strategy to become the leading sugar producer across the African continent.

“We will extend the core values that have resulted in the success of our group companies to the new Southern African operations to benefit employees, growers, and ultimately the economy of the region.

“The group is committed to investing significantly in the operations to modernise the plants and expand them to increase production and efficiencies,” said Seif.

The Tanzania Sugar Board also hailed the country’s firm for spreading its wings into Southern Africa by grabbing such lucrative opportunities in a move described as ‘commendable’.