Interfresh land grab exposes Agribank

AGRICULTURAL Bank of Zimbabwe (Agribank) and the Industrial Development Corporation of South Africa (IDC) are reeling from a US$5 million exposure as it emerged this week that Interfresh Holdings Ltd could default on its obligations after 52% of its productive assets were listed for compulsory acquisition two weeks ago.

Staff Writer

Sources told the Zimbabwe Independent that Interfresh, which lost its prime lemon orchards and crops, seed maize and soya beans at Mazoe Citrus, allegedly to President Robert Mugabe’s wife Grace, could fail to meet its obligations to Agribank. The sources added the group was likely to experience financial constraints given the extent of the asset grab.

Agribank unveiled a US$5 million facility to Interfresh Holdings Ltd under a US$30 million IDC facility, which was guaranteed by the government of Zimbabwe.

Sources said IDC was worried by the exposure and could withhold a further US$30 million line of credit it had pledged to the local financial institution.

But Agribank CEO Sam Malaba described his bank’s relationship with IDC as excellent, adding all beneficiaries of the facility were up to date on their payments.

“As per the terms of the facility, the bank is currently at advanced stages in respect of a further drawdown scheduled for early next month. The bank has an excellent relationship with IDC SA and IDC SA is satisfied with the performance of Agribank and its clients under the terms of the two facilities. All beneficiaries of the IDC SA facilities are up to date in respect of their payments including Interfresh,” said Malaba.

But sources insisted IDC is now worried by the exposure and wants to put the brakes on a similar facility established late last year until it engages Agribank and government officials to see how the institution can extricate itself from imminent losses arising from the Interfresh exposure.

“IDC is concerned they could be throwing good money after bad and would want to hold on to the latest US$30 million facility,” said a source privy to developments. “They want assurance the developments at Interfresh won’t affect their loan book in Zimbabwe.”