Lonrho Zimbabwe returns
(Bloomberg) — LonZim Plc, the investment betting on a recovery in Zimbabwe’s economy, will announce “big” acquisitions, Executive Director Geoffrey White said.\r\n
“We’ll be announcing a couple of really big deals in the next two to three weeks,” White said in an interview in Cape Town today.
Zimbabwe has experienced a decade of recession. Inflation was estimated in July at 231 million percent. Zimbabwe’s health, sewage and water systems have collapsed, exacerbating a cholera outbreak that has killed 2,971 people, according to the United Nations.
LonZim, which is based in London, will still be “fine” should the economy fail turn around in the next five years, said Chairman David Lenigas, who was interviewed alongside White. The two are also chairman and chief executive officer respectively of Lonrho Plc, the conglomerate that has a 20 percent stake in LonZim and which manages the investment company.
While LonZim’s existing investments are “commercially sound, basically none of them are making money,” White said.
Adopting neighbor South Africa’s currency, the rand, would “bring an element of stability” for businesses in the country, White said. Zimbabwe should adopt the currency to stabilize the economy, the Herald, a state-owned newspaper that often carries government announcements, said yesterday.
Lonrho, which is based in Liverpool, plans a $150 million expansion to double the size of its Luba port in Equatorial Guinea.
“We’re looking at possible options including private equity and bank debt,” Lenigas said. He added that the company has invested $80 million in the port, where companies including Exxon Mobil Corp. now operate from. Lonrho acquired 63 percent of Luba Freeport Ltd. in 6.
Lonrho also operates East Africa’s biggest private airline and plans to start operating its Fly540 airline in Angola in the next few weeks, in Ghana in May, and in Zimbabwe “at some point in the future,” White said.