Star Africa struggling to sell investments

Published: 06 June 2014

Listed sugar manufacturer Star Africa appears to be struggling to dispose of its investments in Tongaat Hulett Botswana and BlueStar Logistics.

In its latest update on the matter, the company said: "Earlier efforts to dispose of THB and BSL, as reported in previous updates, have not yielded the intended results as the prospective purchasers failed to raise the funds thereof."

The disposal of Tongaat Hulett Botswana and BlueStar Logistics was initially targeted to be completed by February 28 after a Scheme of Arrangement between Star Africa Corporation Limited and its lenders and creditors was sanctioned by the High Court in August last year.

But latest indications from the group point to earlier interested buyers having turned their backs on the deals.

Star Africa has said "fresh efforts were then made to approach other prospective purchasers."

In an update today, Star Africa said two prospective purchasers are carrying out due diligence on BlueStar Logistics.

"It must be pointed out that while there is interest on the local market for this asset, the liquidity crunch obtaining in the economy is militating against an expeditious disposal thereof," said Star Africa.

"A prospective purchaser is in the process of conducting due diligence on this asset, with cooperation from Starafrica and the other shareholders in THB.

Scheme members will be advised of progress on this transaction in the next update.

This is a good asset, whose disposal must yield maximum value, hence the need to allow due process in respect of its disposal," said the group of its investment in Tongaat Hullet Botswana.

Meanwhile, the sugar producer says significant progress has been made on the plant upgrade at Gold Star Sugars Harare.

"All 47 containers have been shipped of which 41 containers have been delivered at Harare Refinery and the balance will be delivered to site within the next 7 days. Installation of the new equipment is ongoing and is 95 percent complete," said the company.
- BH24

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