Published: 29 August 2013

Gold Star sugar volumes were adversely affected by cheap imports which are dumped into the market, Star Africa's CEO Sam Mushiri told an AGM today.

Mushiri noted that there is now an understanding with the regulatory authorities to manage that so that they end up with "some kind of level playing field" in the sugar market.

Mushiri noted that there were four key deliverables in their plan and these were scheme arrangements, undertaking an upgrade of the Harare sugar refinery, restoring supplier of the raw sugar and disposal of some of the firm's non-core assets.

"A scheme of arrangement with our lenders and creditors was sanctioned by the High Court on the 7th of August 2013 and was registered with the registrar of companies on the 14th of August 2013," he said.

The scheme of arrangement, he said, will allow Star Africa an opportunity to upgrade the Harare refinery and to complete disposal of investments in Tongaat Hullets Botswana and Blue Star Logistics.

This is expected to have a positive effect of stabilising the operations and will also restore the cash generation potential of the business.

Under the scheme of arrangement, a six month standstill period was agreed and long tenures of up to 36 months were also accepted by lenders and creditors.

To date, 85% of the purchase price of the plant has already been paid and the first consignments of the plant are currently under inspection.

The plant is expected to be dispatched by mid-September 2013 and this upgrade will be completed during the current financial year.
- zfn

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