CFI engages potential strategic investors

interested partners and a due diligence process has commenced.
The group added that the board had proposed undertaking a capital raising initiative through a combination of equity and a medium- to long-term debt.
Since dollarisation, CFI is yet to be recapitalised. Disposal of assets comes after the group shelved its proposed rights issue of between US$10 million and US$20 million.
Shareholders did not approve the rights offer saying company shares are undervalued, which negatively affected the company’s net asset value.
CFI said the conclusion of transactions is expected to strengthen the financial position of the company.
The company also intends to raise about US$8 million through the disposal of non-core assets to retire expensive debts and finance working capital.
CFI has since received regulatory approvals for the disposal of its shareholding in Beira Grain Terminal and Windmill. CFI is disposing its entire shareholding in its irrigation equipment firm Dore & Pitt.
The conglomerate is owned 21,7 percent by Stanlap Investments, 7,1 percent by Messina Investments and 6,7 percent by Old Mutual Life.
In 2010 CFI franchised its Town & Country outlets to fast growing supermarket chain Afrofood and the deal is expected to last for three years.
Management at CFI also undertook a raft of structural reforms that included ceasing operations at retail subsidiary Honeydew Farm after the property was returned to its owners early in the year.
Farm & City outlets, which are also controlled by CFI, were repositioned by closing the wholesale dry grocery lines to concentrate on core business.