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TN acquires foam plant for furniture division


TN Holdings Limited has acquired a foam plant for its furniture manufacturing division at a cost of $280 284 to boost its capacity to supply beds.

Commissioning of the plant is scheduled for April next year.

From a strong financial base, the company diversified to furniture manufacturing in January through the acquisition of Tedco Limited and consequently listed on the Zimbabwe Stock Exchange by reverse take-over.

Harry Kantor, TN Holdings chairman, said the foam plant would boost capacity utilisation at TN Harlequin Luxaire, which is currently depressed by bottlenecks in the supply of foam, wire for mattresses, leather, hard and soft wood and frequent power cuts.

Foam is a light form of rubber or plastic made by solidifying small bubbles — a key raw material in bed manufacturing.

“To ease the challenges in the supply of foam, we have imported an automatic foam plant that we hope to commission before the end of the first quarter of 2011,” Kantor said.

“Fabric, wire, leather and foam had to be supplemented by imports as local suppliers have limited capacity to meet requirements.”

Kantor said TN would invest in TN Harlequin’s spring-making and assembling machines in the first half of next year to boost its capacity to produce beds.

Average production at TN Harlequin rose to 75% by June 30 from 18% the prior year following a phased recapitalisation of the division by its new parent in the first half.

Bed production increased to 910 bed sets in June from 197 bed sets in January.

“Production of case goods rose to 98 units in June from 35 units in January and production of lounge suites arose to 365 suites in June from 58 suites in January,” Kantor said.

In the first six months of the year, TN Harlequin reported an operating loss of $1,9 million as the division was largely in a “start-up” phase, refinancing the business, building inventories of both raw materials and finished goods and reintroducing credit terms to promote sales.

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