KEY INVESTMENTS

Background

The Ncise community was removed from their land in 1976 by the then Transkei government to make a way for the building of the Mthata airport. In 2006 NSM Networking services (NSM), an entity which seeks to develop agricultural enterprises in Mthata, identified available land at the Mthata airport.

The Department of Transport was approached to allow NSM to run a greenhouse of high value crops and vegetable seedlings on the land for the benefit of the Ncise community, using hydroponics techniques. Mthata Airport Agricultural Services (M.A.A.S) company was formed for this undertaking. NSM has been granted a ten year renewable lease on 59 hectares of land for the project. Although the company wanted to operate with twenty growing tunnels, they were able to finance ten with equity raised by M.A.A.S.

KERPEF’S Involvement

M.A.A.S approached KERPEF for further funding to make it possible for the company to start operations with the initially envisaged twenty tunnels to produce sufficient leafy crops and seedlings. The location is ideal due to the shortage of fresh vegetables in Mthata. Most suppliers are as far as East London, over 230km away. This results in high prices for vegetables, exacerbating the issue of poverty in the area. Fifteen customers have already given M.A.A.S letters of intent for the fresh produce. With the current capacity of twenty tunnels, the business will not be able to meet the demand and plans to expand further.

Background

Trevor Dunlop and an international partner formed a new company called Tzaneen Wood Plastic Manufacturing (Pty) situated in Nkowankowa township, Tzaneen. The factory manufactures a new synthetic wood that is ideal for decking components. The wood is formed by ccombining recycled plastic waste with sawdust and wood chip waste generated by sawmills in the local forestry business. Most of the Tzaneen Wood Plastic products will be purchased by one of the largest home hardware shops in the US and Europe, Sylvanix International Inc.

The business involves setting up both Tzaneen Wood Plastic and Tzaneen Recycling Company. With 80 000 residents in Tzaneen and a rapidly increasing population of 650 000 people living within a 30km radius of the town, not only is there a large portion of unskilled labour but there is also a growing stream of plastic waste. In partnership with the Limpopo local government, collectors were trained in harvesting usable plastics from surrounding landfill sites and a plastics recycling factory was set up in the burgeoning township of Nkowankowa. The factory is currently up and running and in just less than a year. Almost 300 jobs have been created for collectors who have harvested up to 2 000 tons of plastic waste that would have otherwise been added to the burden of surrounding landfills.

KERPEF’s Involvement

• R25 million total funding was required.
• KERPEF has invested R3.3 million into the business.
• KERPEF and BEE partners hold a total of 26% shares in the business.