Tongaat Hulett Ltd.’s (TON) Zimbabwean units are in talks with the nation’s government about selling majority stakes to black investors, a government official said.
“We are engaging them and discussions are ongoing and advancing well,” Wilson Gwatiringa, head of Zimbabwe’s National Indigenization and Empowerment Board, said in a telephone interview today. “We held several meetings with them in December, but nothing has been concluded unless they sent their documents via courier with new proposals.”
On Oct. 28 the Zimbabwean government, which introduced a law in 2010 forcing all foreign and white-owned businesses to sell or cede 51 percent of their shares to black citizens, gave Tongaat, South Africa’s biggest sugar producer by market value, 14 days to sell a majority stake in the Hippo Valley Estates (HIPO) and Triangle businesses. The Zimbabwean operations contributed 19 percent to Tongaat’s revenue and 32 percent to profit from operations in the six months through September.
Tongaat owns all of Triangle and has a 50.3 percent holding in Hippo Valley Estates.
Sydney Mtsambiwa, the managing director of Tongaat Hulett Zimbabwe, declined to comment when called today.
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