New Sorwatom shareholder gives company and farmers fresh hopes
The tomato-processing company Sorwatom received a new lease of life recently with the sale of a majority stake to a Belgian investor.
The tomato-processing company Sorwatom received a new lease of life recently with the sale of a majority stake to a Belgian investor.
The Belgian company Kurt Invest recently obtained 80% of the shares in Sorwatom in return for the clearance of Frw 1.3 billion of debt owed by the tomato-processing company to creditors.
The deal also allowed to pay 5 months of arrears amounting to Frw 214 million owed to farmers in seven cooperatives.
Although this came as a relive for the tomato-growers, they still argue that Sorwatom should increase the price paid for its raw material, which currently stands at 95 francs per kilo. In reply, Robert Bayigamba who represented the shareholders assured the farmers that the prices would increase with time as the company grows, adding that the company recognized their fundamental contribution.
In addition, Sorwatom has partnered with the ministry of agriculture in a bid to provide high-yield tomato seeds and train the growers in good farming practices. “Farmers have always requested us to show them good farming practices in order to have higher yields, and since their success is our success we are working to put in place a consistent process to help the cooperatives to continue the supply of tomatoes,” Bayigamba said.
The representative of the new investor, Kurt Maylemans, for his part expressed confidence that the company will do well, all the more so since a European company called Manna has agreed to buy 1000 tons of tomato paste per month.
A key component of Sorwatom future plans is to further modernize the factory to improve processing and packaging, which should in turn help the company to ensure the certification of its tomato paste. Already it has partnered the Rwanda Bureau of Standards for quality control so that they can compete fairly in the foreign market.
“We have an excellent facility today, but we look forward to add the appropriate machinery and infrastructure to ensure we are positioned to take advantage of export opportunities beyond Africa,” Maylemans explained.
This would also allow Sorwatom to diversify its product range by adding other tomato-based products such as ketchup and tomato juice.
Meanwhile, in order to avoid another brush with bankruptcy, the company has commissioned business consultancy Karisimbi Business Partners to review Sorwatom’s business plans and capacity building.
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Posted by The Rwanda Focus
on Mar 29 2010. Filed under Business.
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