A Dutch investor is in talks to buy 50% of Ariston’s Claremont Orchards, as the listed agriculture company looks to expand output for exports.
Ariston announced on Thursday that it had started discussions with Tuinbouw Zonder Grenzen B.V for the sale of half of Claremont.
“The transaction will enable Ariston Holdings Limited to receive cash for its 50% equity. This cash will be utilised to further extend the group’s investment in macadamia and avocado for the export market,” Ariston said in a notice to the Zimbabwe Stock Exchange.
If concluded, Ariston will have access to the capital it needs to expand its estates and grow exports.
“Further, after the entry of the Netherlands based company, offshore funding will be availed and utilised to plant new orchards with new export-oriented fruit varieties. Claremont will receive investment of over US$5million over the next three years. The envisaged transaction will ensure that Ariston’s dilution in Claremont Orchards Holdings (Private) Limited will be limited to 50% despite the large funding that will flow into the businesses.”
Ariston: growth plans
Ariston has been looking to ramp up production of macadamia and avocado, both of which have firm demand on the export market. The Netherlands, where Tuinbouw Zonder Grenzen is based, is the biggest destination for Zimbabwean avocados, according to ZimTrade data.
In the six months to March, Ariston had produced 419 tonnes of macadamia, of which 215 tonnes had been sold. For the same period in the previous year, 389 tonnes had been produced with 178 tonnes sold. The current year’s yield for the macadamia crop is expected to be 18% ahead of the prior year, Ariston said. In the June quarter, Ariston’s macadamia volumes were 18% above the same time last year.
Ariston runs estates in the Eastern Highlands and in Norton. Claremont in Nyanga is one of the country’s biggest producers of stone fruit as well as pome fruits, such as apples. Southdown Estate, with locations in Chipinge and Chimanimani, has 1,200 hectares of tea, 450 hectares of macadamia nuts, and 12 hectares of avocados at Clearwater Estate, plus 60 hectares of bananas. Ariston also runs the Kent greenhouses near Norton.
South Africa’s Origin Global Holdings holds the majority 71% of Ariston.
Ariston is one of a number of Zimbabwean companies looking to increase the production of avocados. Meikles has recently announced plans to expand macadamia and avocado production. The global avocado market is estimated at around US$7 billion, according to Trade Map. Zimbabwe
According to Trade Map, Zimbabwe earned US$14.1 million from avocado exports in 2019. Major importers were the Netherlands, the United Kingdom and Germany. Macadamia exports in 2019 were valued at US$20.6 million and growers expect output of up to 9 000 tonnes this year.