MEATCO’s emerging rival, the Beef Value Chain Forum (BVCF) has raised up to N$94 million in a private placement as it looks to put up an abattoir which will provide an alternative for meat producers in the country, Business Express can exclusively reveal.
Earlier in the year, the Forum put on sale, 200 million shares at N$1 each in which they sought to raise N$200 million to kick-start operations. An 88 page private placement memorandum seen by Business Express was shared with prospective producers under an established company named Savanna Beef Processors Limited.
In an interview this week, BVCF chairman Mecki Schneider told Business Express that over 230 producers have purchased shares allowing the Forum to surpass the target of N$90 million which was adjudged to be the successful placement mark.
“These shares are only for meat producers and we are expecting to surpass N$100 million when the placement closes this coming Friday,” Schneider said.
The Forum, Business Express understands, now has 440 paid up members who paid around N$5000 each as membership fees.
“We are going to take the process of coming up with the abattoir step by step and assess every option available. We have offered our goodwill to various stakeholders including government. What we are going to do is to send out an expression of interest and go on tender to really establish how much it will cost us. Then, at the end of the year the shareholders will come together and decide what they want to do,” Schneider said adding that their priority was to ensure that the project is led by producers.
Business Express is also reliably informed that the task force pushing the project has been doing it without any compensation but at will.
Directors leading the placement are Siegfried (Mecki) Schneider, Johannes (John) Muinjo, Frederik Wolfgang Voigts, Harald Werner Marggraff, Eberhard Wolfgang (Ebbie) Fischer, Diethelm Metzger and Stefanus Johannes (Fanie) Oosthuizen.
The authorised share capital of Savanna consists of 250 000 000 Class A ordinary shares with a par value of N$0.01 per share. A subscription of N$200 000 000 is the optimal amount of capital to be invested in viable assets over the initial period following the private placement. To accommodate the authorised share capital of Savanna and for the sake of convenient allocation of subscriptions, the Private Placement Subscription Price is N$ 1.00 per share. Therefore, the Shares were issued at a premium of N$0.99 per share.
The BVCF was established 20 November 2020 to deal with matters related to the beef producers industry. According to the Forum, the objective of the BVCF are to create a sustainable cattle slaughter and marketing industry to ensure a prosperous future for the Namibian beef industry through profitable beef exports, to investigate the probability of a new export abattoir based on the prefeasibility study and updating the latter to a full feasibility study with a bankable business plan and to inform and seek co-operation with all stakeholders in the livestock industry for this initiative.
On the other hand, Savanna Beef Processors Limited was formed and incorporated by the Founders in Windhoek, Namibia as a public company on 18 February 2022 with registration Number: 2022/0137, for the purpose of raising capital through a private placement and deploying the offer proceeds through acquisitions of viable assets in export abattoir industry in Namibia.
Savanna has not traded and has not conducted any business, other than in connection with the preparation of the private placement.
“The intended purpose of Savanna following the private placement will be to pursue acquisition of viable assets within the export abattoir industry. The focus will be on establishing an export abattoir, with Savanna intending to own and operate export abattoirs qualifying as viable assets,” a memo sent to producers earlier this year reads.
Based on the planned capital expenditure, the working capital requirement and budgeted ramp up costs plus additional buffers, it is estimated that the total capital requirement for BVCF is N$497.5 million.
An N$200 million cash subscription and N$25 million land subscription amounts to 45.2% of total capital required. In terms of the debt funding, the business plan recommends that the debt facilities are aligned (matched) with the respective assets, it will be funding, in order to best manage risk. It is thus targeted to raise N$112.5 million in the form of a medium-term loan to assist in funding the fixed capital investment. It is further recommended that an overdraft facility of N$160 million is targeted to fund ramp-up costs and working capital investment.