Tanzanian entrepreneur Dewji plans $2-4 billion grain investment via SPAC

LONDON, July 8 (Reuters) – The head of one of Tanzania’s biggest firms, Mohamed Duji, said he plans to float an agricultural company worth up to $4 billion in New York or London next year, with money, raised mainly by development banks.

Russia’s invasion of Ukraine in February sent global grain and fertilizer prices soaring, although they have eased in recent weeks. Inflation subsequently rose in many African countries.

Dewji, 47, whose family conglomerate MeTL Group employs tens of thousands, said the new company would produce grains and edible oils in Tanzania, Mozambique, Zambia and the Central African Republic.

“This is a fantastic way to provide food security … with the potential to feed ourselves and the world,” he told Reuters in an interview in London on Thursday.

He said he aims to structure the venture, for which he has not yet secured land, as a special purpose acquisition company (SPAC) and would put up $400 million himself as 10% to 20% of the total funding.

A road show to raise the remaining funds is planned for the first quarter of 2023, Dewji said, adding that he is 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, the appetite for vehicles has decreased. Read more

Dewji predicted the new company, which could diversify into soybean and sugar plantations, could bring investors five to 10 times returns over a decade, but would require “patience, impact and long-term capital.”

MeTL, which is unlisted and operates in a range of sectors including textiles, logistics and insurance, plans to invest $250 million over the next two to three years, Dewji said, about 40 percent from bank loans.

This will include adding four factories around Tanzania to an existing soft drinks factory to compete with Coca-Cola and Pepsi and increasing production of sisal, a fibrous plant used in textile production, from 12,000 to 15,000 tonnes this year .

He said MeTL’s current annual revenue exceeds $2 billion and will rise this year due to high commodity prices. He declined to give profit figures.

Reporting by Rachel Savage; edited by John Stonestreet

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