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LAF
LOLAF
LAF - Lonrho Plc - Lonrho`s LonZim Banks GBP32.3 Million
Lonrho Plc
(formerly Lonrho Africa Plc)
(Incorporated and registered in England and Wales)
(Registration number 2805337)
(Share code: LAF; ISIN number: GB0002568813)
("Lonrho" or "the Company")
LONRHO`S LONZIM BANKS GBP32.3 MILLION
Lonrho Plc ("Lonrho"), the African conglomerate with a diverse portfolio of
investments, ranging from infrastructure, transportation, support services and
natural resources, announces today that its newly established subsidiary LonZim
Plc ("LonZim") has raised an initial GBP32.326 million (US$66.234 million) from
a number of existing institutional shareholders of Lonrho by issuing 46,180,958
LonZim shares.
Lonrho holds 30,000,001 shares in LonZim as the founding shareholder (cost
GBP3,001) representing 39.4% of that company and currently holds all board
positions.
LonZim intends to raise additional funds and seek a listing on a major stock
exchange over the coming months.
On listing, Lonrho`s arrangements with LonZim will be:
Lonrho`s initial shareholding will be escrowed for a period of 5 years.
Lonrho will hold a management contract with LonZim whereby it will receive 1% of
gross assets under management and 21/2 % of gross turnover of LonZim per annum.
Lonrho will not compete with LonZim in Zimbabwe whilst Lonrho manages LonZim.
LonZim funds will be escrowed until successful admission to trading on a stock
exchange.
LonZim`s principal focus will be to acquire and invest in key assets in the
property, infrastructure, hotel and commercial sectors in Zimbabwe and
neighbouring countries including the important access corridor to the coast at
Beira in Mozambique.
Lonrho`s management team and consultants offer an in-depth understanding of
business and investment in Africa, including Zimbabwe. The team brings
significant experience in successfully brokering and completing transactions and
developing companies in challenging parts of the continent.
LonZim will adhere to all international and national laws applying to foreign
investment in Zimbabwe and plans to implement and adhere to best practice in
corporate governance.
David Lenigas, Lonrho`s Executive Chairman and Chief Executive, commented:
"There are clearly risks associated with investing in Zimbabwe and this
financial commitment from Lonrho`s existing institutional investors by
subscribing for LonZim shares, prior to a listing, demonstrates their belief
that the opportunities for economic growth in the country are enormous."
"Lonrho believes that there is a substantial commercial opportunity in the
Zimbabwean market, which has deteriorated due to severe underinvestment. This
potentially offers significant upside. As such I believe that cautious and well
informed investment in Zimbabwe and the coastal access corridor will ultimately
offer excellent returns for LonZim shareholders as well as Zimbabwean businesses
and the Zimbabwean economy.
"I strongly believe that the best way to encourage economic growth within a
country and nurture the development of a strong infrastructure and thriving
business culture is through private, foreign direct investment and LonZim fits
with that principle."
For further information, please contact:
Lonrho Plc +44 (0) 20 7016 5105
David Lenigas, Chief Executive +44 (0)7881 825 378
Emma Priestley, Executive Director +44 (0)7867 785 177
Pelham PR
Charles Vivian +44 (0) 20 7743 6672
+44 (0) 7977 297 903
Alisdair Haythornthwaite +44 (0) 20 7743 6676
+44 (0) 771 472 1379
Collins Stewart Europe
Hugh Field and Ellen Francis +44 (0) 20 7523 8000
20th July 2007
South African sponsor to Lonrho Africa Plc
Java Capital (Proprietary) Limited
Date: 23/07/2007 08:52:01 Produced by the JSE SENS Department.
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