ZIMBABWE Stock Exchange-listed wine and spirit maker African Distillers (Afdis) held a board meeting yesterday to discuss the surprise acquisition of its Springvale Estate by government amid fears that it could affect the supply base of its local products and result in loss of jobs.
Government this week announced the seizure of 23 farms for acquisition, among them Springvale Estate which covers about 1 300 hectares. The farm is located in Umzingwane District, Matabeleland South province.
“It is hereby notified that the Minister of Lands and Rural Resettlement, acquires for and on behalf of the state, the land identified in the schedule for purposes of agricultural settlement under Section 72(2) of the Constitution of Zimbabwe,” reads the notice.
“The ownership of the acquired land with full title therein vested in the state is with effect from the date of publication of this notice in the Government Gazette.”
The outcome of what was resolved at the Afdis board meeting was unclear at the time of going to press.
However, Afdis managing director Cecil Gombera last night described the gazetting of the land as “unfortunate”. He said the company would engage government over the issue.
“While it is unfortunate that the said land has been gazetted, the impact of this on Afdis operations will be minimal,” Gombera said.
“We will however be engaging the authorities to ensure that plans are in place for expansion of the supply base of local wines remain intact.”
Afdis is one of the few companies making healthy profits despite the harsh economic environment prevailing in Zimbabwe characterised by a debilitating liquidity crunch, low aggregate demand, lack of cheap funding, low capacity utilisation, company closures and massive job losses.
The company recorded a 47% profit during the half year period ended December 2014 as volumes rose by 20%. It commissioned a new cider plant in October last year.
Afdis now manufactures the bulk of the products it markets which include the Savanna and Hunters cider brands, Gold Blend Whisky, Harrier Whisky, Chateau, Viceroy and Heritage Brandy, gin, rum, vodka as well as sparkling and fortified wines.
The company operates six depots in Bulawayo, Harare, Kwekwe, Masvingo, Mutare and Victoria Falls.
Afdis is not the first company to have land seized. Interfresh Holdings’ Mazoe Citrus Estate, the group’s prime land asset, was seized by President Robert Mugabe’s wife Grace leaving it tottering on the brink of collapse.
Economist Godfrey Kanyenze said the land-grabs would continue to send the wrong signals and repel much-needed investment.
“The land invasions simply mean that land reform has not been concluded,” Kanyenze said. “Country risk will persist and discourage those who want to do business with us. The lack of security for property rights does not help the situation.”