A WAR of words has erupted between bakers and grain millers with bakers accusing millers of blocking foreign investors in the sector.
MTHANDAZO NYONI OWN CORRESPONDENT
According to the National Bakers’ Association of Zimbabwe president Givemore Mesoemvura, millers petitioned the government in December 2014 resisting a $40 million bid to acquire a 75% stake in stressed agro-processor Blue Ribbon Industries by the Bakhresa Group of Tanzania.
Millers argued that the milling sector was among the 14 sectors exclusively reserved for indigenous Zimbabweans.
Millers argued that the judicial manager could have taken a cue from the Lobels Bakeries deal that allowed local financing without selling the controlling stake to foreign capital.
Empowerment laws put a cap on foreign ownership in local companies at 49%. This means the Bakhresa Group requires the government to okay its proposed 75% acquisition of Blue Ribbon.
However, Mesoemvura told Southern Eye Business that the country’s bakers were disturbed by the millers’ behaviour.
“We have a challenge with the local millers who are blocking companies that want to invest in Zimbabwe,” he said.
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“As bakers, we need investors. How can they (millers) block the Bakhresa-Blue Ribbon deal which has a potential of employing more than 300 people?”
Mesoemvura said millers blocked the deal without consulting them.
Blue Ribbon resumed operations mid-2014 under judicial management after a breakthrough following a supply agreement for raw materials.
The company had been closed in 2012 after being weighed down by huge debts and failure to attract fresh capital.
It is currently operating on a reduced scale and requires close to $1 million to return the heavily indebted company back to full production capacity.
Blue Ribbon has five main divisions — Stock Feed Unit, BRI logistics, Blue Ribbon Foods, JA Mitchells and Nutresco Foods.
The Bakhresa Group has a footprint in Tanzania, Uganda, Mozambique, Kenya, Malawi, Seychelles, Burundi, Rwanda and Zambia.
