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$4,5 million dollar injection rescues Lobels

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LOBELS Bread Holdings this week resumed operations after a consortium of local banks, once creditors of the firm, injected $4,5 million after taking over the bread-baking company.

LOBELS Bread Holdings this week resumed operations after a consortium of local banks, once creditors of the firm, injected $4,5 million after taking over the bread-baking company.

Report by Victoria Mtomba Business Reporter

The company ceased operations in June last year due to working capital constraints.

Addressing a Press conference in Harare yesterday, company chairman Casper Chibanga said Lobels would produce 100 000 loaves of bread daily at its Harare plant and 50 000 loaves of bread at its Bulawayo plant.

“Lobels Bread is back,” he said.

“In an effort to modernise Lobels, new bakery equipment will be installed in February or March 2013.

“It is envisaged that by end of March 2013, Harare will have an installed capacity of 250 000 units per day while Bulawayo will be producing 100 000 units.”

Chibanga said the company expects to produce 350 000 loaves daily from its Harare and Bulawayo units and install a confectionery line by the first quarter of next year.

He said the new shareholders had already invested $1,3 million for the equipment that was expected to be in the country from South Africa early next year.

The consortium of local banks — NMB, FBC, CBZ, Capital Bank and Metbank — under the vehicle Altiwave, now holds 100% shareholding of the Harare bakery and 90% of the Bulawayo bakery.

It is understood that the banks were owed $14 million which they turned into equity in the bread- producing company.

Chibanga said the banks took over the company to preserve jobs, protect creditors and to keep Lobels Bread on the market.

He said they hoped the company would be able to pay of its debt currently standing at $19 million.

Chibanga said the company began refurbishments of Plant 9 in August this year and it was still work in progress.

Lobels Bread was started by Lobels Brothers in Bulawayo in 1957, and was bought by a consortium of businessman in 2002 and expanded the operations to Bulawayo with the opening capacity of 60 000 in 2004.

The Lobels Harare bakery at its peak used to produce 400 000 loaves daily and had a 40% market share which it lost when it closed down last year.