Milk Afric, a project spearheaded by Botswana Development Corporation (BDC), has lost another potential investor after negotiations collapsed, leading to the United Arab Emirates (UAE) based company pulling out of the deal.
This week, the minister of trade and industry, Mmusi Kgafela, told parliament that UAE’s leading dairy company Al Rawabi that was touted as a likely investor in the Lobatse located milk dairy project had placed heavy concessions on BDC, which the state-owned investment company rejected, and led to Al Rawabi withdrawing from the proposed transaction.
Had the deal gone through, the UAE company had envisaged starting production with 200 dairy cows through debt funding of $60 million. Al Rawabi, was established in 1989 in the heart of Dubai’s desert in Al Khawaneej with 500 imported cows.
The dairy farm currently has over 16,500 cattle, with a production facility operating 24 hours. Al Rawabi currently produces 350,000 litres of dairy products and 150,000 litres of juice products per day.
This February, Kgafela disclosed to parliament that Al Rawabi, which had done assessments in the country on where to set up, ended up settling for the Milk Afric infrastructure. In April 2016, BDC formed a partnership with Milk Afric, a dairy farm originally from the United States who wanted to relocate to Botswana. BDC invested P40 million in the project for a 26% stake.
The BDC investment was earmarked for the development of the dairy farm while Milk Afric was to make a contribution of a herd of 2,000 dairy cows. However, six years later, the project has failed to take off, with the USA partner bowing out. Having spent over P48 million on the project so far, the BDC has been trying to save it from total collapse, taking control of the whole project and frantically searching for technical partners.
Now without a technical partner, the minister said BDC would be looking for suitable operators who will lease the farm, with preference given to wholly owned citizen companies.
“An expression of interest will be floated during the month of August 2023 in that regard,” he said.
Source: https://www.sundaystandard.info/milk-afric-back-on-the-market-after-another-investor-bolts-out/
