Willdale to develop 178 hectares in Mt Hampden

LISTED brick maker, Willdale, plans to develop idle land valued at US$2,95 million in Mt Hampden into residential, commercial and industrial stands.

The brick maker is sitting on massive idle land measuring 178,2 hectares and plans to unlock the land value and realise about 6,8 times the current value.

The funds will be channelled to acquisition of a new US$3 million plant cable of producing higher quality bricks to compete more effectively in the domestic and regional markets.

Willdale hopes its manufacturing technology will help reduce cost, waste and increase year-round production.

The development of high-quality bricks would allow the company to compete more effectively locally and in the region.

The firm is engaged in making and selling clay bricks and its products include common bricks, face bricks, semi-faced bricks and paving bricks.

For Willdale to unlock the land value and capitalise on its proximity to the new Parliament Building and new city, it plans to develop the land into residential, commercial and industrial stands and later dispose of them.

According to the firm, proceeds from the sale of developed stands for the Haydon and Kinvarra transactions are projected to rack in up to US$10,6 million and US$8,2 million respectively, resulting in an upside multiplier of approximately 6,8 times of the current land value.

Development agreements have already been entered into with two firms; Zusammen (Private) Limited, in respect of four pieces of land measuring approximately 123,6 hectares at Haydon, Mt Hampden and Melrose Construction (Private) Limited trading as integrated Construction Projects in respect of land to be subdivided into 42 hectares at Kinvarra, Mt Hampden.

To get the nod to execute the plans, an extraordinary general meeting will be convened to consider whether or not to pass set resolutions with or without modification.

The meeting is set for April 4.

In a circular to shareholders, Willdale chairman, Mr Cleopas Makoni, said the company has land in an area that is fast developing because of the new Parliament Building and the new city located nearby.

The company also has excess idle land in Christmas Gift, Gweru, measuring approximately 12,6 hectares, bringing the total land available for development to about 178,2 hectares.

“Developing the land will result in the company achieving a significantly higher value for the land compared to its current valuation of US$2,95 million,” said Mr Makoni.

He noted that the company’s current manufacturing plant only allows for seasonal production of bricks, with full scale production happening between March and November, while the production plant is shut down for up to three months from December to February each year to use natural sunlight drying for bricks before they are fired.

“This effectively means that there exists scope for the company to optimise its production capacity by mitigating the downtime occasioned by the aforesaid seasonality.

“Technology is available to enable all year round production of bricks. Such technology involves the use of tunnel or rotary dries and kilns.

“The company intends to acquire and install a plant with a rotary kiln and dryer to enhance its production capacity.”

He added that the proposed manufacturing technology, which will cost about US$3 million, will result in the reduction of production waste and costs and production will be all year round.

Added to that, the new plant will enable environmentally friendly production processes and international competitiveness.

“In order to fund this new plant, the company intends to tap into its land banks, through the proposed Haydon, Kinvarra and Christmas Gift partnerships to unlock value and channel this into the growth of the business.

“Shareholder approval is therefore sought to give directors the authority to bring the Development Agreements with the contractors into effect and allow the directors to enter into similar development agreements for the other identified idle land (Christmas Gift),” added Mr Makoni.