Tanganda to relist on ZSE

ZIMBABWE'S largest producer and distributor of tea and other beverages, Tanganda Tea Company Limited, is expected to relist on the Zimbabwe Stock Exchange (ZSE) after over a decade of absence. This will follow its unbundling from parent company, diversified hospitality group Meikles Limited.

In a notice to shareholders, Meikles company secretary, Mr Thabani Mpofu, indicated the group was looking at unbundling the agriculture processing business and its separate listing on the bourse.

"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," he 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.

"To this end the company has engaged professional advisors. Shareholder approvals will be sought in due course, with these processes running alongside normal year end procedures.

"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," said Mr Mpofu.

Tanganda Tea Company began operations in the 1920s and is the leading producer of tea in the country with interests in other agriculture products such as macadamia nuts and avocados, which are exported.

Parent company, Meikles has expressed optimism for the agriculture business and export crops going forward as the country has received good rains during this 2020/21 season coupled with improved electricity supplies needed for irrigation.

"The good rains received this season bodes well for the group's agriculture segment and growth in export crops is expected in the forthcoming financial year.

"Our dams are full and power, which is essential for irrigation and estate factories will be available not only from traditional sources, but also from the solar projects," said Mr Mpofu in a trading update for the third quarter and nine months to 31 December 2020.

According to the update, bulk tea production benefited from early rains and grew by 41 percent and 6 percent for the quarter and year to date, respectively. But bulk tea production was 17 percent behind last year as at the half year ended 30 September 2020.

In volume terms, bulk tea export sales were behind last year by 8 percent and 10 percent for the quarter and year to date, respectively.

Average bulk tea export price for the quarter of US$1,39 per kg was on par with the average price achieved same period last year but was 6 percent behind last year for the year to date.

Mr Mpofu indicated that packed tea and coffee sales volume grew by 24 percent and 18 percent for the quarter and year to date respectively.

Despite the challenging operating environment, indications are that the Meikles group has sufficient resources at its disposal to fund the planned capital expenditure and challenges arising from Covid-19 implications.