Zimbabwean conglomerate TSL Limited is on the brink of finalising a landmark US$25 million acquisition of a 51.43% controlling stake in Nampak Zimbabwe, marking a significant step in its strategy to build a fully integrated packaging and distribution business.
In an exclusive interview, TSL chief executive officer Derek Odoteye confirmed that the only outstanding steps are shareholder and regulatory approvals, with financial preparations and legal agreements already in place.
"From a financing perspective, we are in a secure position. The main issue that remains is getting shareholder approvals. Regulatory approvals are also in the pipeline," Odoteye said. "Once these two components are in place, we expect to close the transaction towards the latter part of this year. From our end, the financial resources are ready, and the intent is strong."
TSL signed a binding sale and purchase agreement with Nampak Limited, the South African parent company of Nampak Zimbabwe, in what Odoteye described as a "crucial milestone" that cements the seriousness and structure of the deal.
"This agreement is now the basis for what will be presented for shareholder approval," he noted. "It sets out the key terms and forms the foundation upon which the transaction is being processed."
The company is pursuing regulatory clearance from the Competition and Tariff Commission and other relevant authorities, in addition to shareholder approvals required under statutory and listing regulations.
TSL is funding the transaction through a combination of internal resources and structured finance, having reallocated part of its US$4.5 million capital expenditure budget for 2025 towards the acquisition.
"We have earmarked about US$4.5 million in capex for the year. However, we have also reallocated some of what would have been capex towards the Nampak acquisition, which is a strategic investment," Odoteye said.
The deal will add a second packaging unit to TSL's growing portfolio, joining its existing business, ProPack.
"We currently have ProPack in that space, and Nampak would be the second packaging business," he said. "We believe what Nampak currently does - packaging from field to marketplace, and also from processing to consumer - is an area we want to focus on and expand."
The acquisition is expected to significantly enhance TSL's vertical integration model by linking its agricultural, logistics, and packaging operations into a more competitive and streamlined value chain.
Nampak Zimbabwe posted approximately US$100 million in turnover in its most recent financial year - nearly three times TSL's full-year revenue of US$36.89 million as of October 31, 2024.
"Their infrastructure, client relationships, and systems will enhance our packaging footprint. This is not just about adding size, but about creating a more competitive offering in the market," Odoteye emphasised.
Nampak Limited announced its intention to offload its 51.43% stake in October 2024 as part of a broader strategy to reduce group debt and cut exposure to Zimbabwe's volatile economic environment.
Once concluded, the acquisition is expected to reshape Zimbabwe's packaging sector and position TSL as a dominant force in the industry.
- The Independent
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