A takeover of one of Southern Africa’s biggest sugar producers by a wealthy Zimbabwean family was never going to be sweet news for everyone in South Africa’s financial markets.
But, according to Hamish Rudland, who has just won a shareholder vote that will give him control of Tongaat Hulett, a Zimbabwean owning Tongaat is not a handicap. It is just what the troubled company needs.
The bulk of the company’s output is from Zimbabwe – at Hippo Valley and Triangle – and Zimbabwean shareholders know the lay of the land more than anyone, he says.
“With Tongaat’s largest operating business being in Zimbabwe, our local knowledge of the landscape and operating environment will be of significant benefit to Tongaat,” Rudland said ahead of the vote, in a response to questions over his intentions.
At an EGM yesterday, Tongaat shareholders approved the proposal by Magister to underwrite a R4 billion rights offer for the company. Tongaat is desperate for fresh capital to erase a debt bill that was as high as R11 billion and to start fixing the damage from an accounting scandal.
Magister is led by Hamish Rudland, the brother of tobacco tycoon Simon Rudland, who is a shareholder of Gold Leaf Tobacco.
While the final details of the capital raise (such as share price) are yet to be finalised, one of the resolutions shareholders also had to vote on was related to appointing Hamish Rudland as a new director on the Tongaat Hulett board as part of the proposed deal. – Newswire- Moneyweb.Herald.