A CHANCE meeting at a conference six months ago has led to JSE-listed Zeder Investments making its first acquisition outside SA with the purchase of a 96% stake in a Zambian agricultural operation for R375m.
Zeder, which is 42% owned by investments company PSG, is also spending R150m to fully acquire local seed company Agricol.
Announcing the two deals yesterday, PSG CEO Piet Mouton said they marked a new thrust in the group's expansion into Africa. The group is taking small steps into a region that is attracting local and international investors.
They are being drawn by high economic growth rates and an expanding middle class, and sectors attracting them include consumer and financial services and mining.
PSG, through a new unit, PSG Africa, has already entered the consumer sector through its purchase of consumer goods distributor CA Enterprises of Botswana for R300m.
Mr Mouton said the investment in Chayton Africa, the Zambian agricultural venture, was a bold statement by Zeder of its intention to become a major player in the commercial agricultural sector in the region.
"This marks something of a change of strategy for Zeder," Mr Mouton said. He said the deal had taken about six months to conclude - the first advance was made at a conference with investors in Chayton Africa.
The Zambian operation had 1250ha under commercial farming and it planned to extend this to about 10000ha over the next two years.
"Zeder believes the Chayton management is key to realising the full potential of this investment and takes significant comfort from management's proven track record in developing and managing large-scale African commercial farms," Zeder said in a regulatory announcement yesterday.
"Zeder is excited about the role that Africa, with its vast agricultural resources, could play in addressing the growing global demand for food and believes that Chayton is the appropriate vehicle to grow into a premier sub-Saharan African agribusiness," it said.
In the same announcement, Zeder said it would, through wholly owned subsidiary Zeder Financial Services, increase its stake in Agricol from 25,1% to 100% for R150,4m.
"Zeder views its acquisition of Agricol as an important phase in its investment strategy and plans to use this vehicle to drive a South African and an African expansion in the seed business," the company said.