Banks fund Mugabe’s Alpha Omega empire

PRESIDENT Robert Mugabe’s family dairy business, Alpha Omega,whose funding has always been queried, is on the verge of completing a multimillion dollar expansion exercise thanks to local banks, a company official said.

Taurai Mangudhla

Alpha Omega general manager Stanley Nhari said local banks, in particular the Industrial Development Bank of Zimbabwe (IDBZ) and CBZ Bank, were funding the ongoing expansion. “At the moment I am not in a position to say how much the plant has cost because we are still installing some ancillaries. We are borrowing the money from banks; it’s something which is very clear, we borrow from CBZ, we borrow from IDBZ and we borrow like any other company,” he said during a tour of the Alpha Omega plant in Mazowe this week.

Government remains the largest single investor in CBZ Holdings and owns more than 99% of IDBZ, making them amenable to fund top state officials’ businesses and other interests. The local banks’ decision to fund Mugabe’s business raises questions at a time companies, even those listed on the Zimbabwe Stock Exchange, are crumbling due to lack of capital as the economy suffers from tight liquidity.

The expansion project, expected to improve the company’s product mix, will see Alpha Omega add two new state-of- the-art ice cream manufacturing plants and a chocolate manufacturing plant by end of March, management said. The two ice cream plants have already been imported from Italy and are at advanced stages of installation.

Information gathered by businessdigest shows a modern high quality ice cream processing machinery production line plant from Asia costs around US$1 million. Market information suggests the price is much higher in Europe. “We have done much of the installation which is required by our company. We expect the technicians from the various suppliers to be landing in Zimbabwe by mid-March so that they finalise installation and then we kick start the ice cream production. We believe that before the end of this month we will have the ice cream on the market,” Nhari added.

Two hundred vendor cans have already been purchased and will be used to sell the ice cream at different points, he said. Management said the company would start producing pure chocolate, chocolate ice cream, chocolate bars, sweets and candy by end of March.

Alpha Omega said it was also targeting to double raw milk output to 40 000 litres per day by year end, from the current 23 000 litres per day.

Nhari said the company was breeding heifers internally and also importing from other countries. The company has resolved to induce its herd to ensure the cows go on heat after which mass artificial insemination would be done to boost its herd, he said.

“Apart from this, we are doing an expansion on the beef side, we don’t want to only concentrate on dairy. We are also increasing our seed production and we do it through Seedco,” said Nhari.

Alpha Omega’s beef herd currently stands at around 3 000 and the company’s target is to treble it in the short to medium term. In terms of capacity utilisation, Nhari said the production plant was operating at around 20% due to economic challenges.

“We are just around 20% capacity utilisation and we are not happy at all. We can’t produce products which will not be bought. There is no cash in the market and whatever people have will be prioritised and if people have to make a choice between a dairy product and maize meal, they will go for maize meal,” he said.

The company will start exporting some its products to grow sales, he added. The first batch for export is expected to be sent to Botswana in April.

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12 Responses to Banks fund Mugabe’s Alpha Omega empire

  1. Majuru March 6, 2015 at 9:09 am #

    Nhandi Cde Nhari, I am one one of your biggest customers sezvo ndichitsigira Gushungo muzvese. Ndokukurudzirai kurapa mastitis kuitira kuti musatengesera vanhu maproducts anoora! Otherwise pamberi ne Alpha and Omega. Ndokuti Indigenisation kauku

  2. Wezhira March 6, 2015 at 10:21 am #

    First you accuse Gushungo of corruption/theft to fund the dairy….then they reveal they borrow money like any other business and you still have a problem with them? Ah u can’t be helped

    • Nyaningwe-Chibi March 6, 2015 at 11:58 am #

      They have refused to let us see who benefitted from RBZ’s quasi fiscal activities, who looted what from that scgeme and how much. It is an open sectret that Mugabe and his family were the biggest beneficiaries and are busy smuggling thischikwereti onto the povo so that they can benefit completely from our blood, sweat and tears! This fairst family is the most corrupt in Zimbabwe. Government resources are used and they dont pay, they are never even billed. They dont pay ZESA, Blood thieves! Manje musi wakanadonha zvechokwadi zvekuenda 3ft tinozvitora zvedu zveziya!

    • Cde March 8, 2015 at 6:26 pm #

      If you care to be sensible and objective I think you will see the point of the article being that since govt is in CBZ and IDBZ as major investors it follows the Gushungos have an unfair advantage over all the other struggling companies in as far as access to investment funds is concerned. That said…as you can see, the dairy is only at 20% capacity utilization; telling us they don’t posses the same advantage when going to market because the market cannot be politically manipulated as is the case with CBZ and IDBZ for the most part.

    • Cde March 8, 2015 at 6:26 pm #

      @Wezhira If you care to be sensible and objective I think you will see the point of the article being that since govt is in CBZ and IDBZ as major investors it follows the Gushungos have an unfair advantage over all the other struggling companies in as far as access to investment funds is concerned. That said…as you can see, the dairy is only at 20% capacity utilization; telling us they don’t posses the same advantage when going to market because the market cannot be politically manipulated as is the case with CBZ and IDBZ for the most part.

  3. miranzi March 6, 2015 at 11:38 am #

    1 its not industrial but infrastructure development bank of zimbabwe, wat happened to cross-checking facts n figures n names before publishing.

    2 what wrong with gushungo business borrowing like any other business. At least he is productive and creating employment. Thats great coz he is leading by example

  4. Grabmore March 6, 2015 at 1:32 pm #

    Wezhira… read carefully…….. Government remains the largest single investor in CBZ Holdings and owns more than 99% of IDBZ.

  5. mukwerekwere March 6, 2015 at 10:17 pm #

    Tell him Grabmore, he misses the conflict of interest there.

  6. fear me March 7, 2015 at 12:33 am #

    It will soon be expropriated and nationalized. Big time zpuff thieving !!!!!!!!

  7. pasipamire March 14, 2015 at 8:32 am #

    This is a business borrowing money from banks to fund expansion and probably employ more Zimbabweans. Is this the first company to borrow money from banks? Where is the story?

    • Changamire Dombo March 15, 2015 at 11:42 pm #

      Are you dull? Which other company gets money from these other than this dairy project

  8. ndu March 19, 2015 at 5:20 pm #

    What are they using as collateral since the land on which this project stands is stolen property?it shows the thieving nature of the bloody kaffier bankers !

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