ONE of the most highly regarded fund managers in London has committed US$25 million of clients' money to investment in Zimbabwe.
Neil Woodford, who manages about ₤15 billion for Invesco Perpetual, has bought a stake of 29.5 per cent in Masawara, a fund that will be valued at US$80m when trading in the shares begins on London's Alternative Investment Market in a fortnight.
Masawara intends to buy into Zimbabwean mines and oil companies, agriculture, telecommunications and property as well as to take part in privatisations of state-held assets.
Masawara, which is incorporated in Jersey, owns 40 per cent of Harare's biggest commercial property development and almost a third of TA Holdings, another investment company with stakes in agriculture and mining.
TA is run by business mogul, Shingai Mutasa, who will identify Masawara's future investments.
Woodford’s Zimbabwe investment has attracted mixed reviews, some analysts wondering if it’s not a gamble too far for a man famous for his shrewd judgment.
“Woodford has set himself up strongly in a market that is poised for a rebound,” said Will Peters, writing on the Economy News. “There is huge amounts of spare capacity in the economy, and should the politics continue to improve, Invesco clients should be well rewarded.”
But Gwen Robinson, writing on the Financial Times website, was not so sure: “... with plans by the Mugabe government to force foreign-owned businesses to transfer stakes of at least 15 per cent to black Zimbabweans, a recent IMF warning to Harare about economic stagnation and the latest anti-western rant from Zimbabwean president Robert Mugabe on Monday, one might wonder about Woodford’s — and of course, Masawara’s — sense of timing.
“Then again, one might also wonder if they know something we don’t.”