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Business Reporters
INNSCOR Africa Limited has moved its headquarters to Mauritius as part of a calculated move to enhance access to cheaper finance to support its domestic and foreign expansion programme.
The conglomerate already has a footprint in Mauritius through Innscor International Limited, incorporated in 1998, the same year Innscor Africa listed on the Zimbabwe Stock Exchange.
Zimbabwean firms have struggled to raise offshore capital due to the perceived risk profile attached to the country because of the country’s high debt overhang.
While it was not clear how much the firm would raise, sources said Innscor wants to continue expanding its fast foods business and recapitalise other operations in and outside Zimbabwe.
Recapitalisation of its business in Zimbabwe will include its Spar Supermarket chain, crocodile business, furniture and appliances operations. There is also a strong thrust toward supporting operations in countries across the entire region.
According to a strategy document seen by The Herald Business, “Innscor intends to materially increase the footprint of its operations outside Zimbabwe in the few years and the financial springboard available through IIL in Mauritius will help facilitate this expansion by a major Zimbabwean company”.
The document says that 20 percent of Innscor Africa’s revenues are generated outside Zimbabwe in countries such as Zambia, Kenya, Ghana, Senegal, Malawi, DRC, Nigeria, Lesotho and Swaziland. The revenues are generated through fast foods, distribution and supermarkets.
Several other companies, foreign and local, invested in Zimbabwe have targeted Mauritius, a reputable international tax haven, as the gateway to accessing cheaper capital and lines of credit.
Firms with interests in local entities that have used Mauritius as the springboard for their investment projects on the continent include ADC Mauritius (ABC Holdings), AfrAsia (AfrAsia Zim), Essar Africa (Zisco) and businessman Tawanda Nyambirai’s Lifestyle Holdings.
“Innscor seeks to enhance access to cheaper sources of funding through Mauritius and has assigned one of its directors to look after the Mauritius HQ,” said a source privy to developments.
“IIL was incorporated in Mauritius to enable access to cheap and plentiful finance and ease of investment into the rest of Africa and beyond. This motivation remains unchanged and is more relevant than ever given the massive amounts of finance available from banks based in Mauritius.”
Online Reporter