HomeBusinessStarafrica in bid to sell subsidiaries after deals fail

Starafrica in bid to sell subsidiaries after deals fail

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HARARE — Struggling starafricacorporation says it is making new efforts to find buyers for its local transport firm, Bluestar Logistics (BSL) and for its 33,3% stake in Tongaat Hulett Botswana (THB) after previous arrangements failed to materialise.

Early this year, the group said it has received a $5,6 million offer for its 33,3% stake in THB while another offer had been made by a local company for it transport firm, BSL.

The disposal of the assets were meant to offset its nearly $20 million debt and starafrica missed a court sanctioned deadline of February 14 to pay off creditors.

On Friday the group said earlier efforts to dispose of THB and BSL fell off as the prospective purchasers failed to raise the funds, leaving the company to make fresh approaches to other investors.

It said two potential buyers were carrying out due diligence on BSL while a prospective purchaser is conducting a similar exercise on THB.

“It must be pointed out that while there is interest on the local market for BSL, the liquidity crunch obtaining in the economy is militating against an expeditious disposal,” the company said in an update on Friday.

Funds from the logistics company will go towards settling a vehicle finance loan and transaction costs, it added.

On THB, it said: “This is a good asset, whose disposal must yield maximum value, hence the need to allow due process in respect of its disposal.”

On the $5 million plant upgrade, it said the installation of the new equipment 95% complete with commissioning of the upgraded plant and resumption of sugar production expected later this month.

The company stopped producing sugar last year to pave way for the upgrade.

— The Source

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