Willdale Limited 2024 Circular

Willdale Limited | Circular to Shareholders

By Published On: March 12th, 2024Categories: Corporate announcement

CHAIRMAN’S LETTER TO SHAREHOLDERS

Dear Shareholders,

The Company has approximately 165.6 hectares of land in Mt Hampden, an area that is fast developing owing to the new Parliament Building and the new city located nearby. This has presented an opportunity to develop the land into residential, commercial and industrial stands. Furthermore, the Company has excess idle land in Christmas Gift, Gweru measuring approximately 12.6 hectares, bringing the total land available for development to about 178.2 hectares.

Developing the land will result in the Company achieving a significantly higher value for the land compared to its current valuation of circa US$2.95 million. The proceeds from the development will then be channeled towards the acquisition of a new plant and make our bricks higher quality and enable the Company to compete effectively locally and in the region.

The Company’s current manufacturing plant only allows for seasonal production of bricks, with full scale production happening between March and November while the production plant is shut down for up to 3 months from December to February each year because of the need to use natural sunlight for drying bricks before they are fired. This effectively means that there exists scope for the Company to optimise its production capacity by mitigating the downtime occasioned by the aforesaid seasonality.

Technology is available to enable all year round production of bricks. Such technology involves the use of tunnel or rotary driers and kilns. The Company intends to acquire and install a plant with a rotary kiln and dryer to enhance its production capacity.

The proposed manufacturing technology which will cost approximately US$3 million will result in the following benefits:

  1. Reduction of production waste;
  2. Reduction in production cost;
  3. Production being all year round rather than being seasonal;
  4. Environmentally friendly production process; and
  5. International competitiveness.

In order to fund this new plant, the Company intends to tap into its land banks, through the proposed Haydon, Kinvarra and Christmas Gift partnerships to unlock value and channel this into the growth of the business.

Shareholder approval is therefore sought to give directors the authority to bring the Development Agreements with the Contractors, into effect and to allow the directors to enter into similar development agreements for the other identified idle land (Christmas Gift).

It is the Board’s view that these developments will bring substantial benefits to the Company and its Shareholders. Accordingly, on behalf of the Board, I recommend all Shareholders to vote in favour of the resolutions approving the proposed Haydon and Kinvarra Transactions and the proposed Future Transaction (“the proposed Transactions”).

Thank you

Yours faithfully,

For and on behalf of the Board of Willdale Limited

Cleophas Makoni
(Chairman)


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