A consortium consisting of a Zimbabwean businessman, a South African billionaire, and a Pakistani sugar producer has taken over Tongaat Hulett, Zimbabwe’s largest sugar producer. Tongaat Hulett faced financial difficulties and went into business rescue in October 2022 due to a fraud committed by its executives, resulting in debts of R12 billion.
Initially, Tongaat’s administrators had planned to sell the company to Kagera, a Tanzania sugar producer. However, the deal fell through due to court challenges from other bidders and criticism from the Zimbabwe government, which desired control over the strategic asset, it is reported.
Last Thursday, Tongaat’s creditors voted in favour of a new buyer, the Vision Group consortium. The consortium will acquire 97.3% of the company by assuming approximately R8 billion of its debt.
One member of the consortium is Rutenhuro Moyo, whose investment company Remoggo is involved in retail, agribusiness, logistics, and facilities management services across Zimbabwe and other African countries. Remoggo is Moyo’s investment company, registered in Mauritius. According to the Tongaat administrators, Remoggo is invested in “retail, agribusiness, logistics, and facilities management services in Zimbabwe and seven other African countries”. Moyo has been on the Hippo Valley board since 2020. He is also chairman of ZSE-listed company National Tyre Services and sits on the boards of FBC Holdings and OK Zimbabwe. He has had past roles at South Africa’s Shanduka Group, leading its interests in Coca-Cola SA and McDonalds SA. In December, it was reported that he had invested US$420,000 into Jamboo, a tech start-up planning to launch digital banking services to the African Diaspora.
Robert Gumede, a South African billionaire, is represented through his company Guma Agri, which is part of the Guma Group. Almoiz Industries, one of Pakistan’s prominent sugar producers, is also part of the consortium, alongside Terris AgriPro owned by businessman Amre Youness, who has previously represented mining interests in Zimbabwe.
Tongaat’s concerns in Zimbabwe include issues related to land tenure, competition from cheap imported sugar, and rising costs. The company briefed President Emmerson Mnangagwa on the transaction and highlighted challenges such as the negative impact of duty suspensions on local sugar sales and government interventions affecting the cost base and cash flow. In addition, the lack of signed 99-year leases for land tenure creates further uncertainty.
Hippo Valley, a subsidiary of Tongaat, sold a significant amount of sugar in Zimbabwe, accounting for nearly 53% of the country’s total sugar sales in the six months leading up to September.