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12 May 2020 08:26
Zambeef Products plc
("Zambeef" or the "Group")
Related Party Transactions
Zambeef (AIM: ZAM), the fully integrated food producer with operations in Zambia, Nigeria and Ghana, announces the following related party transactions involving Non-Executive Director, Mr. John Rabb, and the former Chief Executive Officer, Mr. Francis Grogan, over cattle purchases for the calendar year 2020.
Mr. John Rabb is one of a class of beneficiaries in Sussex Trust, an organisation that owns 100% shareholding in Wellspring Ltd ("Wellspring") and Mr. Francis Grogan is a 50% shareholder in Chisamba Ranching and Cropping Ltd ("CRC"). The two companies will be contracted to supply cattle to the Company commencing in April 2020 (and ending December 2020), as they have done in previous years.
Based on 2019 supplied quantities, Wellspring is expected to supply approximately 1,343 cattle with an approximate value of K4,600,185 (c. US$260,000) and CRC is expected to supply 1,480 cattle with an approximate value of K7,830,617 (c. US$440,000).
Further information
Further details on the cattle supply agreements are set out below:
Wellspring CRC
Period of Contract April -December 2020 April -December 2020
Number of Cattle 1,343 1,480
Type of cattle. Qty. Price/kg live wt. Qty. Price/kg live wt.
Culled Bulls 25 K11.70 30 K11.10
Culled Cows 504 K11.70 150 K11.10
Steers/Heifers. 814 K14.50 1,300 14.60
Zambeef buys weaners (heifer and steers) culled cows and Bulls from these two suppliers and these are placed in the feedlot for about six months before being slaughtered. For the year 2019, CRC supplied 1,522 cattle and Wellspring supplied 1,056 cattle. Zambeef also buys cattle from other traditional and commercial farmers throughout the year. On average, the Company keeps about 8,000 cattle in the feedlot during the year.
Related Party Transactions
The cattle supply agreements with Wellspring and CRC fall to be treated as related party transactions pursuant to the AIM Rules for Companies ("AIM Rules"). The Directors of Zambeef, other than Mr John Rabb, having consulted with Strand Hanson Limited in its capacity as the Company's Nominated Adviser for the purposes of the AIM Rules consider that the terms of these cattle supply agreements to be fair and reasonable insofar as shareholders are concerned.
Zambeef Products Plc Walter Roodt, Chief Executive Officer Faith Mukutu, Chief Financial Officer
| Tel: +260 (0) 211 369003 |
Strand Hanson Limited James Spinney Ritchie Balmer Rob Patrick
| Tel: +44 (0) 20 7409 3494 |
Finncap Christopher Raggett
| Tel: +44 (0) 20 7220 0500 |
Powerscourt Nick Dibden Bethany Johannsen
| Tel: +44 (0)20 7250 1446 |
Pangaea Securities Wendy Tembo | Tel: +260 (0) 211 220 707 |
Notes to Editors
The Zambeef Group is one of the largest integrated cold chain food producers in Zambia, involved in the production, processing, distribution and retailing of beef, chicken, pork, milk, eggs, dairy products, fish, flour and stock feed. The Group also has large cereal row cropping operations (principally maize, soya beans and wheat), with approximately 7,971 hectares of row crops under irrigation, which are planted twice a year and a further 8,623 hectares of rain-fed/dry-land crops available for planting each year.
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.
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