20th Jul 2007 16:07
Lonrho PLC20 July 2007 LONRHO PLC ("Lonrho" or "The Company") Lonrho's LonZim banks £32.3 million Lonrho Plc ("Lonrho"), the African conglomerate with a diverse portfolio ofinvestments, ranging from infrastructure, transportation, support services andnatural resources, announces today that its newly established subsidiary LonZimPlc ("LonZim") has raised an initial £32.326 million (US$66.234 million) from anumber of existing institutional shareholders of Lonrho by issuing 46,180,958LonZim shares. Lonrho holds 30,000,001 shares in LonZim as the founding shareholder (cost£3,001) representing 39.4% of that company and currently holds all boardpositions. LonZim intends to raise additional funds and seek a listing on a major stockexchange 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 theproperty, infrastructure, hotel and commercial sectors in Zimbabwe andneighbouring countries including the important access corridor to the coast atBeira in Mozambique. Lonrho's management team and consultants offer an in-depth understanding ofbusiness and investment in Africa, including Zimbabwe. The team bringssignificant experience in successfully brokering and completing transactions anddeveloping companies in challenging parts of the continent. LonZim will adhere to all international and national laws applying to foreigninvestment in Zimbabwe and plans to implement and adhere to best practice incorporate governance. David Lenigas, Lonrho's Executive Chairman and Chief Executive, commented: "There are clearly risks associated with investing in Zimbabwe and thisfinancial commitment from Lonrho's existing institutional investors bysubscribing for LonZim shares, prior to a listing, demonstrates their beliefthat the opportunities for economic growth in the country are enormous." "Lonrho believes that there is a substantial commercial opportunity in theZimbabwean market, which has deteriorated due to severe underinvestment. Thispotentially offers significant upside. As such I believe that cautious and wellinformed investment in Zimbabwe and the coastal access corridor will ultimatelyoffer excellent returns for LonZim shareholders as well as Zimbabwean businessesand the Zimbabwean economy. "I strongly believe that the best way to encourage economic growth within acountry and nurture the development of a strong infrastructure and thrivingbusiness culture is through private, foreign direct investment and LonZim fitswith that principle." 20th July 2007 For further information, please contact:Lonrho Plc +44 (0) 20 7016 5105David Lenigas, Chief Executive +44 (0)7881 825 378Emma Priestley, Executive Director +44 (0)7867 785 177 Pelham PRCharles Vivian +44 (0) 20 7743 6672 +44 (0) 7977 297 903Alisdair Haythornthwaite +44 (0) 20 7743 6676 +44 (0) 771 472 1379Collins Stewart EuropeHugh Field and Ellen Francis +44 (0) 20 7523 8000 Notes to Editors: About Lonrho: Lonrho Plc is an expanding conglomerate that is rapidly growing a successfulbusiness throughout Africa. The Company is listed on the London AIM stockexchange (LONR). Lonrho is strategically focused on the development of businessopportunities in infrastructure, transportation, support services and naturalresources. The Company has over 20,000 shareholders and substantialinstitutional backing to support its mandate to build a profitable business thatplays a fundamental role in the development of the African economy. Since 2006, the Company has invested in or acquired control of: Hotel Cardoso - www.hotelcardoso.co.mz (retained)Nare Diamonds - www.narediamonds.comBrinkley Mining - www.brinkley-mining.comLuba Freeport - www.lubafreeport.comFly540 - www.fly540.comNorse Air - www.norseair.co.zaSwissta Holdings - www.swissta.comCountermine - www.countermine.comSA Independent Liner Services This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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