Zim’s Wealthy Rudland Family Set To Take Over Tongaat Hulett

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By Business Reporter/Agencies

A BILLIONAIRE family – the Rudlands are on the verge of acquiring one of Southern Africa’s biggest sugar producers, Tongaat Hulett, by underwriting the company’s US$257 million rights issue.

A Mauritius registered company – Magister – owned by Hamish Rudland, recently engineered the consolidation of Zimplow and Unifreight subsidiaries.

Zimplow and Unifreight are Zimbabwean registered companies.

However, details show Magister could now expand its investment by holding up to 60% of Tongaat after the share offer.

This would give the Rudlands control of a company that produces 43% of South Africa’s sugar and accounts for over 50% of Zimbabwe’s sugar sales. Tongaat is also the major producer in Mozambique and Botswana.

Magister currently owns 0.15% in Tongaat and has offered to underwrite half of the proposed rights issue, some US$128,5 million, Tongaat said in a statement this week.

“We have agreed that they (Magister) get a board seat for every 20% of shares that they own, with a maximum cap of 60%,” Tongaat CEO Gavin Hudson said.

“We assume that they would be a large shareholder by the end of the rights offer. But that will be determined in January or February next year.”

According to Tongaat chief financial officer Rob Aitken, if minority shareholders do not take up the remaining stock, Magister’s stake could reach up 60%.

However, if minorities subscribe, Magister’s holding will be somewhere in the “mid-range,” Reuters news agency added.

“Magister has vast experience in sectors which complement THL’s strategic focus areas. Magister is expected to add value (to Tongaat) through its logistics, agricultural management, and commercial experience,” Tongaat said in a JSE filing Wednesday.

Last year, Tongaat almost collapsed after an accounting scandal where the previous executive had falsified profit figures, and the company has been looking to raise cash to fund a turnaround.

“The introduction of Magister is expected to add impetus to THL’s turnaround strategy and provide the management team with the financial and operational flexibility to redirect its focus towards growth initiatives,” Tongaat said.

In Zimbabwe, Tongaat’s Hippo Valley has been growing output by expanding land under cane and signing up private farmers.

Project Kilimanjaro, a US$40 million investment to open up 4 000 hectares of virgin land for production, has been delayed by a lack of funding and insecurity over land tenure.

However, the company had its sugar milling licence extended by the government by a further 20 years to December 2040, while tenure is being secured on its two main estates.

Hamish Rudland and his brother Simon formed Pioneer Transport in 1995, growing their business into Pioneer Corporation Africa through the acquisitions of other leading transport businesses, including Unifreight – owners of Swift Transport – Bulwark, and Clan.

In 2015, Simon Rudland launched the Rudland & George cigarette brand.

The Rudlands have been active investors on the Zimbabwe Stock Exchange, holding significant stakes in assets such as Zimre, through his investment vehicle Day River Corporation, and in agriculture company CFI.