Seed Co eyes growth after failed merger

Seed Co Limited says it will continue with its growth strategy despite abandoning its consolidation plans, which were turned down by the Reserve Bank of Zimbabwe (RBZ).

In an interview, group chief executive officer Morgan Nzwere said consolidation would have, however, made it easier to fund raise for new projects.

“The strategy in terms of growing the business is going to continue,” said Mr Nzwere on the sidelines of the official launch of the group’s new vegetable seed varieties at Stapleford Research Station last week.

“It was part of our strategy to consolidate the group. It makes it easier to manage the it and to fund-raise because we would be using one big balance sheet. Now that this was turned down by authorities, we have to re-strategise. At the end of the day the business has to continue to grow, we have to raise cheap funding for it to grow.

“Right now, we are about to open our new drying facility which will be officially commissioned next month. We have brought in US$12 million from PROPARCO in France for that and we will keep sourcing for cheap international funding.

“It would have been easier had we been able to consolidate the balance sheet but we still have to find ways of going around it and grow the business,” he said.

Last week, the seed producer re-listed on the Zimbabwe Stock Exchange (ZSE) following the cancellation by the group’s plans to merge Seed Co Limited with Seed Co International, which currently trades on the United States dollar denominated Victoria Falls Stock Exchange (VFEX).

After the Reserve Bank of Zimbabwe (RBZ) turned down the transaction, Seed Co International and Seed Co Limited will continue to operate as 2 separately listed companies, listed on the VFEX and ZSE, respectively.

Meanwhile, Mr Nzwere indicated that while the seed industry faces funding challenges, there were vast opportunities for the group across the region especially in relation to vegetable seeds.

Zimbabwe for instance is projecting positive growth forecasts that will be driven by improved agriculture production and the seed industry plays a critical role in that anticipated increased output.

“The expectation the world over is that the next billionaires will come from the agriculture sector. Global population is growing, people need to eat and we have land here in Africa. We should take advantage of that to feed the world.

“There are also vast opportunities in vegetable seed because this is a business anyone can venture into from their backyard,” he said.

He added the group would continue working on new varieties that mature early, drought and pest resistant to ensure farming business remains viable.

He said: “There are new pests coming every year and we have to stay ahead of that. Farmers should be able to realise profits from their businesses.”

The group last week introduced new vegetable seed varieties for the market in line with its vision of providing cost effective and high yielding varieties that boost agriculture output.-herald.cl.zw