Aug. 21, 2014
French seed maker Vilmorin will pay $27 million to double its stake in Zimbabwean crop seed firm SeedCo to 32% by year-end, chief executive of the Harare-listed company said on Wednesday.
Vilmorin, the world's fourth-largest seed maker, took a 15% stake in SeedCo last October, saying this would give it a stronger foothold in Africa where the market for commercial seed is worth $1 billion.
SeedCo is the top maize seed producer in Malawi, Zambia and Zimbabwe and also distributes its products in several east African countries.
The company's chief executive, Morgan Nzwere, told a shareholder meeting that proceeds from the sale would be used to pay down debt. Nzwere also said his company should continue to grow earnings on the market share gains in east Africa. "We are expecting our earnings to grow on the back of continued market share growth in east Africa largely through the retail market as adoption of our varieties continues.”
Nzwere also said SeedCo was owed $27 million for previous seed purchases by the Zimbabwean government and had been promised payment before the start of a new farming season in October.