The investment will support the company’s growth plans and environmental and social improvements.
CDC Group plc’s $65 million investment into Zambeef Products plc has been approved by regulators. The 17.5 per cent equity stake will support the company’s growth plans and further improvements to the company’s environmental and social standards. This is CDC’s first direct equity investment in Zambia since the early 2000s.
CDC is the UK’s development finance institution. It invests in businesses in Africa and South Asia to grow businesses, help create jobs and make a lasting difference to people living in the poorest parts of the world. CDC prioritises investing in agribusiness because it is a sector where growth leads to jobs, and it helps provide access to safe and nutritious food to meet a population’s needs.
As Zambia’s largest food processing business, Zambeef places a strong focus on promoting agricultural self-sufficiency and improving food security. For example, Zambeef sources 70 per cent of its cattle and 85 per cent of its pigs from small scale suppliers, and around 45,000 tonnes of cereal grain from small scale farmers, providing a much-needed market for local small-scale businesses.
CDC’s investment will enable Zambeef to grow the business, in particular its cold chain food processing businesses as well as expanding its distribution and retailing platform within Zambia and adjoining markets. This will widen Zambian consumers’ access to Zambeef’s range of good quality and nutritious products.
The investment will also support the implementation of a detailed environmental and social action plan over the next three to five years, including the achievement of international certification standards.
CDC has a long history of investing in Zambia to promote economic development, including throughout tough economic cycles. One of CDC’s first investments in 1949 was in Chilanga Cement in then-Northern Rhodesia, just one year after CDC’s establishment in 1948. CDC remained involved in Chilanga Cement for 53 years and led the company to be the first business listed on the newly-opened Lusaka Stock Exchange in 1995.
CDC continued to make direct investments in Zambia right the way up until the early 2000s when CDC became a fund of funds investor only. CDC remained invested in the country as a funds investor and is currently invested in nine funds active in Zambia.
This is CDC’s second direct investment in Zambia since it started making direct investments again in 2012, the first being a US$40 million loan to IHS Zambia Ltd.