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Conrad Mwanawashe : Business Reporter

LISTED agro-concern, CFI Holdings expects to conclude the disposal of its 50 percent stake in its chicken business, Suncrest, within the next four months. CFI director Hamish Rudland said during a tour of Glenara Estates by The Herald Business last Friday the group is in advanced talks with technical partners Superchicks for the stake.He said the company is looking for a partner who has technical knowledge in the chicken business and who is prepared to inject at least $10 million.

“We are currently working with our partner, in Superchicks but we haven’t tied the thing up correctly. We are in big talks with them and we should be finalising in the next three or four months. They are the guys we are targeting to partner,” Mr Rudland said.

“The brand is good. The Suncrest brand was number one for many years but it has lost ground. When you look at this infrastructure, the Sunvalley where we are putting up layer project, I would say not less than $10 million,” he said.

If the negotiations are successful and the investor injects $10 million this will take the company’s capitalisation to $20 million inclusive of the existing infrastructure.

Turnaround time expected to be two years.

“I would say we will start seeing positive returns in two years. The growing cycle, in terms of the turnaround cycle is quite long because we want to enter the business from a day old chicks. So we want to bring in parent birds and create day old chicks. We want to create our own brand of retail chicks that we can retail through Farm & City that we will also put into broiler production and into the supermarkets.

The new venture will also take over CFI’s land bank in Harare South area to create more land capacity.

The new venture will utilise the 160 000 capacity chicken houses at Glenara Estates which have been lying idle for about three years now. The facility was built on a loan from PTA Bank currently at about $2,7 million inclusive of penalties and interest.

Mr Rudland said they have applied to retire the debt through the Zimbabwe Asset Management Company, but if that fails the group will focus on negotiating with PTA Bank to restructure the loan facility to 10 years.

“It’s such a sad state of affairs but we will get there. We are talking to them (PTA Bank). They were about to start grabbing assets and start selling them to recover their money. They want some guarantees and we hope to come to an understanding soon. This is a world-class facility, probably the best chicken production house in the country, fully automated, automatic feeders, water and temperature and we have to get it up and running,” said Mr Rudland.

“Our strategy is to bring in a technical partner who knows the chickens and who is prepared to invest in it. We become a 50 percent shareholder, the holder of the asset and they become the technical partner and then we enter the market again. It will be run as an independent business unit so that does not suck from others,” said Mr Rudland.

Two houses are operational at the moment with the other two expected to come on line in the next few months.