Mohammed Dewji
Tanzanian entrepreneur Dewji plans $2-4bln grains production investment via SPAC
by Rachel Savage
LONDON - The head of one of Tanzania's biggest firms, Mohammed Dewji, said he plans to float an agriculture company worth up to $4 billion in New York or London next year, with money raised mainly from development banks.
Russia's invasion of Ukraine in February sent global grain and fertiliser prices soaring, though they have retreated in recent weeks. Inflation has subsequently risen in many African countries.
Dewji, 47, whose family conglomerate MeTL Group employs tens of thousands, said the new company will produce grains and edible oils in Tanzania, Mozambique, Zambia and the Central African Republic.
"This is a fantastic way to bring food security... with the potential to feed ourselves and feed the world," he told Reuters in an interview in London on Thursday.
He said he aimed to structure the venture, for which he has yet to secure land, as a special purpose acquisition company (SPAC) and would himself put up $400 million as 10% to 20% of total funding.
A roadshow to raise the remaining funds is planned in the first quarter of 2023, Dewji said, adding he was open to other forms of fundraising.
SPACs are shell corporations that list on stock exchanges to merge with an existing company to take it public without going through a conventional IPO process. This year, appetite has waned for the vehicles.
Dewji predicted the new company, which might diversify into soy bean and sugar plantations, could net investors a five- to 10-time return over a decade, but would require "patient, impact, long-term capital."
MeTL, which is unlisted and operates in a range of sectors also including textiles, logistics and insurance, plans to invest $250 million in the next two to three years, Dewji said, about 40% from bank loans.
That would include adding four factories around Tanzania to an existing soft drinks factory to compete with Coca-Cola and Pepsi and raising production of sisal, a fibrous plant used in textile production, from 12,000 to 15,000 tons this year.
He said MeTL's current annual revenues topped $2 billion and would rise this year due to high commodity prices. He declined to give profit figures.
