BY KUDZAI KUWAZA
BLUE CHIP conglomerate Meikles Limited is set to unbundle its agro-business operation Tanganda Tea Company Limited and separately list it on the Zimbabwe Stock Exchange (ZSE), according a market update released on Thursday.
Meikles has roped in advisors to guide it through the process that could help the ZSE end its long listing drought, according to company secretary Thabani Mpofu.
Mpofu said plans were underway to seek shareholder approval on the transaction.
Tanganda’s listing is part of several crucial issues under consideration at the conglomerate, whose interests span from tourism, retail and agricultural operations.
“The board of directors of the company wish to advise shareholders and members of the investing public that the board is engaged in discussions and is considering various proposals which, if implemented, may have a material impact on the value of the company’s shares,” Mpofu said.
“In this regard the directors have determined to unbundle from the company and separately list on the Zimbabwe Stock Exchange the company’s agricultural processing business, Tanganda Tea Company Limited. Shareholders and members of the investing public are advised to exercise caution and consult their professional advisors before dealing in the company’s shares until the full details of the transaction(s) are announced or upon withdrawal of this cautionary,” Mpofu added.
Tanganda is one of the country’s top tea processing firms, and produces the popular Tanganda Tea brand under large swathes of prime estates in Zimbabwe’s eastern districts. Despite its massive operation spanning over eight decades, the firm had been indirectly listed through its influential parent, Meikles. But it is one of several big Zimbabwean brands that could be ripe for listing to achieve full potential.
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In 2019, Tanganda finance director Henry Nemaire revealed that the firm had been saved from collapse after an overhaul of its business model from 2010 before rising to reclaim its position, clinching multi-million-dollar deals, thanks to the swift executive response.
He said after it became clear that an 80-year-old model that Tanganda’s flagship tea business relied on would throw Zimbabwe’s biggest tea producer into the abyss, its executive moved to diversify into avocado and macadamia nuts, which are in high demand on the international markets.
“The dynamics were changing, and strategic moves were imperative to reposition the business”, Nemaire told a Confederation of Zimbabwe Industries exporters conference.
“Without this strategy, Tanganda was going to wind up, but the strategy started bearing fruit in 2017,” he said.
Combined tea output from all players stood at 18 000 tonnes in 2018, according to Nemaire.
But the market could only consume 4 000 tonnes, which left a staggering 14 000 tonnes without takers.
“In 2010, we decided to diversify the business beyond tea production. We were standing on one leg. We decided to diversify into export crops and our strategy was to diversify into avocados and macadamia nuts to export to Europe,” he said.
Meikles announced yesterday that it had declared a dividend of $0,42,5 per share for the year ended March 31, 2021.
“Notice is hereby given that the board of directors declared a second interim dividend Number 84 of ZWL42,5 cents per share payable out of the profits for the financial year ended 31 March 2021,” Mpofu said.
“The dividend will be payable on or about 11 May 2021. Disbursements to foreign shareholders is subject to Exchange Control Approval and payment guidelines for foreign payments,” he added.
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