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Nelson Gahadza-Senior Business Reporter

MEIKLES Limited has reaffirmed its intention to unbundle the agricultural business, Tanganda Tea Company Limited, from the group and list it separately on the Zimbabwe Stock Exchange (ZSE).

The diversified group, itself already listed on the local bourse, is primarily invested in the agriculture, hotels and retail sector. It first announced plans to de-merge Tanganda  in April this year.

Meikles company secretary, Mr Thabani Mpofu, further reminded shareholders this week that subject to their approval, the company would not rescind on the transaction.

“…shareholders are advised that Meikles Limited board of directors has determined to unbundle from the company and list separately on the Zimbabwe Stock Exchange the company’s agricultural processing business, Tanganda Tea Company Limited, subject to shareholders’ approval. 

“If successfully concluded, this transaction may have a material effect on the price of the company’s shares, the full impact of which is still being determined,” said Mr Mpofu.

The unbundling of Tanganda Tea marks another major transaction after the group in 2020 sold its flagship asset the Meikles Hotel to Dubai-based Albwardy Investments for a consideration of US$20 million. 

The deal was consummated after the group conceded that it had no capacity to mobilise the US$30 million required for the hotel’s refurbishment to turn it into a five-star property. 

Meikles has been undergoing a phased restructuring.

John Moxon, the group’s chairman, in the group’s financial year to March 31, 2021, said the company had provided additional capital to Tanganda since 2011 to support the crop diversification thrust with the capital being additional to Tanganda’s normal annual capital expenditure.

As at March 31, 2021, Meikles had cumulatively injected US$20,8 million for macadamia nuts and avocados plantations development, an avocado processing facility and recently for solar power plants and further capital has been provided subsequent to the year-end.

“Tanganda is now in a strong financial position and well set to independently sustain its operations going forward. Subject to shareholders’ approval, Tanganda is to be unbundled in the months before the end of the calendar year and is to be separately listed. It will cease to have any financial connection with the Group,” he said.

In the period under review, tea production grew 10 percent to 9 188 tonnes compared to 8 319 tonnes in prior year.

Average export selling price for bulk tea was US$1,38 per kilogramme, down four percent from a prior year average of US$1,44 per kilogramme.