Views
3 years ago

Free State Investment Prospectus

  • Text
  • Freestate
  • Southafrica
  • Africa
  • Opportunities
  • Investment
  • Invest
  • Prospectus
  • Rural
  • Funding
  • Mangaung
  • Economic
  • Municipality
  • Institution
  • Agriculture
  • Financed
  • Infrastructure
  • Mapsez
THE FREE STATE, with 2.8-million residents, accounted for 5% of South Africa’s population in 2017/18 and contributed proportionately to the GDP. In 2018 (the latest available data), the real economy (represented by agriculture, mining, manufacturing and construction) made up 27% of the Free State’s output. The largest real-economy sector was mining at 11% of the provincial economy, followed by manufacturing at 9%, agriculture at 4% and construction at 3%. The Free State contributed 10% of national agriculture and 7% of national mining, but just 4% of national manufacturing and 3.5% of national construction.

INVESTMENT OPPORTUNITIES

INVESTMENT OPPORTUNITIES Renewable Energy Renewable Energy Manufacturing Agro-processing PROJECT SECTOR: Renewable Energy PROJECT LOCATION: Bothaville, Free State INVESTMENT VALUE: R2.5 billion JOB CREATION: 5 000 jobs COMPANY NAME AND BACKGROUND: Mabele Fuels (Pty) Ltd – a company registered in the Republic of South Africa whose business is the manufacture of fuel-grade ethanol from grain sorghum for sale to the South African biofuels market. The company was founded and incorporated in 2005 and resolves to build a bioethanol-from-sorghum plant in Bothaville in the Free State PROJECT DESCRIPTION: The establishment of a sorghum-based bio-ethanol refinery in Bothaville. The plant will have the capacity to produce 153-million litres of fuel-grade bio-ethanol per year FINANCED BY: Equity capital and financial institutions PROJECT STATUS: Awaiting regulatory approval PROJECT PROMOTER: Free State Development Corporation (FDC) INSTITUTION CONTACT DETAILS: Department of Energy Tel: 057 391 1326/1300 | Fax: 057 352 2673 PROJECT SECTOR: Renewable Energy PROJECT LOCATION: Welkom, Free State INVESTMENT VALUE: R450 million JOB CREATION: 405 jobs COMPANY NAME AND BACKGROUND: Tetra4 is a vertically integrated gas producer operating in South Africa. Tetra4 is a natural gas producer that provides sustainable, clean energy solutions to large-scale users in the Free State mining region. It has 13 operational wells producing methane-rich natural gas and uniquely occurring helium. The methane-rich natural gas is a clean substitute for transport fuel and thermal fuel PROJECT DESCRIPTION: Tetra4 will produce the country’s first liquefied natural gas (LNG) locally and sell to transport companies for use in trucks to reduce reliance on imported diesel. Furthermore, the company will export helium, which will make South Africa the eighth country in the world with proven helium reserves FINANCED BY: R220-million equity and R230-million loan finance PROJECT STATUS: Project packaging and development PROJECT PROMOTER: Free State Development Corporation (FDC) INSTITUTION CONTACT DETAILS: Free State Development Corporation Tel: 051 400 0800 PROJECT SECTOR: Manufacturing PROJECT LOCATION: Botshabelo, Bloemfontein INVESTMENT VALUE: R300 million JOB CREATION: 500 jobs COMPANY NAME AND BACKGROUND: Rui Star PROJECT DESCRIPTION: The company will source scrap metal across South Africa and process it into steel and iron FINANCED BY: R200-million shareholder loans and R100-million bank loans PROJECT STATUS: • EIA approvals • Establishment of SMME scrap metal suppliers • Investigate an opportunity for a metal fabrication plant to supply construction, building and infrastructure sector PROJECT PROMOTER: Free State Development Corporation (FDC) INSTITUTION CONTACT DETAILS: Free State Development Corporation Tel: 051 400 0800 PROJECT SECTOR: Agro-processing PROJECT LOCATION: Maluti-A-Phofung SEZ INVESTMENT VALUE: R50 million JOB CREATION: 50 - 90 jobs COMPANY NAME AND BACKGROUND: Steynsburg Pork Abattoir is a subsidiary of Danish company Teli Steynsburg Pork Aps located in Copenhagen, Denmark. The parent company has more than 30 years’ experience in the pork processing business & launched its maiden venture into South Africa through its investment at the MAPSEZ in the form of a pig abattoir. Through the establishment of this abattoir, the investor aims to create jobs, transfer skills and expertise to the SA job market, and develop the growing market for pork in SA and the SADC region PROJECT DESCRIPTION: The investor will be slaughtering approximately 360 000 pigs per year. The pigs will be deboned at MAPSEZ and exported to Denmark. The investor owns a piggery in Ladysmith and pigs will be brought daily to the MAPSEZ for slaughtering and deboning. The required project costs are R60-millon for top structure and another R50-million for equipment. The project is to be funded by the investor FINANCED BY: Self funded PROJECT STATUS: • Building plans awaiting local municipality approval • Construction to commence in March 2019 following approval PROJECT PROMOTER: MAPSEZ INSTITUTION CONTACT DETAILS: MAPSEZ Tel: 051 400 0880 12 13

INVESTMENT OPPORTUNITIES Chemicals Agro-processing Agro-processing Agro-processing PROJECT SECTOR: Chemicals PROJECT LOCATION: Maluti-A-Phofung SEZ INVESTMENT VALUE: R250 million JOB CREATION: 126 jobs COMPANY NAME AND BACKGROUND: Kevali Chemicals Group (Pty) Ltd is a proudly South African industrial chemical manufacturing company founded in 2014. It is the first black-owned manufacturing company within this industry PROJECT DESCRIPTION: Kevali Chemicals is a local company that begun its operations in Croatia exporting its finished products to its African clientele. It is a starch chemicals producer that manufactures industrial glues, cleaning agents, etc. The company has opened a plant at the MAPSEZ with the aim of creating a wider African footprint. The investor has a multi-national and multi-corporation customer base as well as domestic customers FINANCED BY: • Operational funding: estimated at R50-million and will be funded by the Industrial Development Corporation (IDC) and the Department of Trade and Industry’s Black Industrialist Scheme • Capital funding: funded by the Department of Trade and Industry at R133m PROJECT STATUS: • Tender adjudication process concluded at the end of February 2019 • Construction commenced in April 2019 following the adjudication and approval of building plans by the local municipality PROJECT PROMOTER: MAPSEZ INSTITUTION CONTACT DETAILS: MAPSEZ Tel: 051 400 0880 PROJECT SECTOR: Agro-processing PROJECT LOCATION: Maluti-A-Phofung SEZ INVESTMENT VALUE: R90 million JOB CREATION: 75 - 100 jobs COMPANY NAME AND BACKGROUND: GTM Beef Abattoir is a special-purpose vehicle formed by three previously disadvantaged partners. This project includes a 500-head-per-day abattoir and deboning plant, 10 000 hectares of land and a 4 200-head feedlot to be accommodated outside the zone. GTM Beef incorporates local economic development through its partnership with the Free State Department of Agriculture and, by extension, 42 local emerging farmers PROJECT DESCRIPTION: The company expects to export beef to China and the UAE. A total of 500 heads per day are to be slaughtered. The investor will source cattle local farmers. The business is comprised of local business people FINANCED BY: • Capital funding: the Department of Trade and Industry approved R59-million for top structure funding • Operational funding: the Free State Department of Agriculture and the Industrial Development Corporation approved R90-million in funding PROJECT STATUS: • Tender adjudication is in progress • Construction commenced in April 2019 following the adjudication and approval of building plans by the local municipality. PROJECT PROMOTER: MAPSEZ INSTITUTION CONTACT DETAILS: MAPSEZ Tel: 051 400 0880 PROJECT SECTOR: Agro-processing PROJECT LOCATION: Maluti-A-Phofung SEZ INVESTMENT VALUE: TBC JOB CREATION: 130 jobs COMPANY NAME AND BACKGROUND: The Department of Rural Development and Land Reform and the Department of Agriculture will establish an Agri-parks project scheme created to promote local farmers in the commercial market space. The scheme will see commercial business being handed over PROJECT DESCRIPTION: The departments will establish an Agri-park at the MAPSEZ. Local beneficiaries will lease various portions of land in the Agri-park in partnership with the departments. The Department of Rural Development and Land Reform will fund the operational budget (opex) while an application for capital funding (R40-million) has been submitted to the dti. Dairy will be sourced from local farmers which will be processed and sold at domestic retail points. The department will partner with local beneficiaries for 10 years and gradually exit the agreement over the 10-year period FINANCED BY: • Operational funding: Department of Rural Development and Land Reform and Department of Agriculture.• Capital funding: Department of Trade and Industry and Department of Agriculture will contribute the value of R40-million PROJECT STATUS: Application for top structure funding has been submitted to the dti for consideration during the sitting of their SEZ fund adjudication committee PROJECT PROMOTER: MAPSEZ INSTITUTION CONTACT DETAILS: MAPSEZ Tel: 051 400 0880 PROJECT SECTOR: Agro-processing PROJECT LOCATION: Maluti-A-Phofung SEZ INVESTMENT VALUE: R90 million JOB CREATION: 80 jobs COMPANY NAME AND BACKGROUND: Innovative Farming (Botala Energy) is one of the first engineering companies in South Africa providing turnkey bio-gas plants of all sizes. Its services portfolio includes feasibility design, engineering and construction of bio-gas plants and provision of technical service, energy optimisation and operation support PROJECT DESCRIPTION: The investor will be establishing a bio-gas facility which will convert sorghum and other bio-degradable materials into compresses gas. The investor has an offtake agreement with Novo Energy. They will source sorghum and other materials from local Free State farmers FINANCED BY: Operational funding: R25-million sourced from private equity funding and the Industrial Development Corporation PROJECT STATUS: • Application for top structure funding submitted to the Department of Trade and Industry • Application to the Department of Trade and Industry was rejected due to the unconventional nature of the investor’s proposed structure • The business case is currently being reworked for further application to both the Department of Trade and Industry and the Industrial Department Corporation PROJECT PROMOTER: MAPSEZ INSTITUTION CONTACT DETAILS: MAPSEZ Tel: 051 400 0880 14 15

Other recent publications by Global Africa Network: