Takura Capital takes over Interfresh: Another big name rescue for private equity fund

Citrus harvest at Interfresh: can Zim citrus flourish again?

Takura Capital has taken control of agro-processor Interfresh Limited, as it bids to revive yet another stricken big brand.

The private fund has, in recent years, rescued and relaunched many struggling companies, among them Cairns Foods and breadmaker Lobels.

Takura’s Interfresh transaction was approved by the Competition and Tariff Commission on March 4.

“Takura is acquiring 100% shareholding in Interfresh Mauritius, which in turn holds 100% shareholding in Ice-Jay, the majority shareholder (with) 82.4% in Interfresh Limited. The remaining 17,6% is passive investment. Takura will acquire these as second phase acquisition,” the competition watchdog announced.

“The intention for Takura is to become the sole owner of Interfresh.”

Icejay became a shareholder after extending bridging finance to Interfresh in 2013. A subsequent rights offer in 2013, which was undersubscribed, diluted previous shareholders further.

Takura is a significant recipient of funding from the UK government’s development finance institution, the Commonwealth Development Corporation (CDC). Takura’s investment extends CDC’s involvement in Interfresh. Agric-focused private equity fund Zebu Investments, which is also backed by CDC, invested in Interfresh in 2012 and helped the company delist from the Zimbabwe Stock Exchange in 2014 to focus on re-engineering the business.

Interfresh asset seizures

Interfresh was once a thriving integrated agro-processing firm whose main asset was the Mazoe Citrus Estates, a major supplier to Mazoe orange crush producer Schweppes. But Interfresh lost more than half of its land through land seizures, forcing it to leave the ZSE.

First, Interfresh lost its Cornucopia orchard, which accounted for about 19% of Mazoe Citrus Estate’s citrus hectarage, to former government minister Saviour Kasukuwere in 2002.

Kasukuwere fenced off the orchards, but initially allowed Interfresh access and control of the citrus orchards and dryer. This changed in 2005, when the then minister claimed ownership of the citrus orchards and the dryer, while demanding payment for the fruit harvested from the orchards.

Grace’s lands

Interfresh’s woes continued in 2013, when the company lost further land, this time to former first lady Grace Mugabe.

In a notice to shareholders in January 2013, Interfresh said a portion of its land, measuring 1 599,7 hectares, which was part of Mazoe Citrus Estates, had been allocated to another party. The other party turned out to be Grace Mugabe, who was expanding her territory in Mazowe, where she already ran a dairy farm, an orphanage and a school.

“This portion of land represents 46% of Mazoe Citrus Estate’s total arable land, 30% of its budgeted revenue for the financial year 2013 and 52% of the value of immovable and biological assets,” Interfresh said at the time.

The Mugabes proceeded to lease out the land excised from Interfresh to businessman Hamish Rudland in a deal that would earn them 5% of the annual turnover from operations on the leased land.

Interfresh barely survived the loss of more than half of its land, with the resultant collapse in revenue from about US$10 million in 2012 to some US$3.1 million a year later.

Enter Takura

Although the value of the Interfresh acquisition could not be immediately established, Takura typically invests between US$3 million and US$7 million.

The Zimbabwean investment holding company has interests spanning private healthcare, manufacturing and retail.

Since 2013, when it made its first investment into Takura, the CDC has injected at least US$23 million into the private equity fund.

Takura has been instrumental in the turnaround of some of Zimbabwe’s best known firms.

Cairns Foods, the maker of brands such as Sun Jam, Chompkins, Cashel Valley and Thingz, went insolvent in 2013. Through Takura, Cairns received up to US$30 million in equity finance, and this saw its capacity utilisation rising to 70% by 2018, boosted by a new Cashel Valley baked beans plant. Famous Cairns brands such as Spuds and Chip Stix returned to market.

In 2011, one of the country’s oldest bakeries, Lobels, shut down under the weight of bank debts. After an investment by Takura, the company avoided collapse, expanded, and even acquired a new business, Kwekwe’s Plaza Bakery.

Takura is also a significant shareholder in Avenues and Montague clinics. It is also invested in the fresh produce retailer Food Lovers Market through franchisee Talwant. Takura has also invested in Montana Meats.

Apart from Interfresh, Takura’s most recent investments also include brickmaker Radar.  The transaction was completed late last year.

Radar delisted from the ZSE in 2016, after years of poor performance. The company is involved in property investments, and also runs McDonald Bricks in Bulawayo. In 2019, Radar reported it had new clay deposits to feed its plant, but did not have the money needed to exploit the asset. Radar said it sits on 70 years’ worth of brickmaking clay, and that its plant has the capacity to produce 80 million bricks per year.