By Collins Mtika
Ma’aden, Saudi Arabia’s largest mining company has acquired an 85 percent controlling stake in Meridian Group which used to own the following companies in Malawi; Farmers World Ltd, Demeter Seed Ltd, Malawi Fertilizer Company Limited, Agora Ltd, Grain Securities Ltd, Liwonde Property Investment Limited and Optichem (2000) Limited
Meridian is a top African agricultural inputs company distributing about 500,000 tons of superior fertilizer, including custom blends, across Malawi, Mozambique, Zimbabwe, and Zambia, generating annual revenues exceeding $300million.
Ma’aden is one of the fastest growing mining and mineral materials companies in the world and the largest mining company in the Middle East.
Meridian, upon completion of the divestment, the company’s executive team will
remain in place, creating a partnership with publicly-listed Ma’adan that will
strengthen Meridian’s market position through capitalizing upon Ma’adan’s
integrated supply chain and global presence.
“Through the combined ability and vision of management and Phatisa, Meridian has developed its business to become the regional fertiliser market leader,” said Chris Giannakis, co-CEO, Meridian. “We are excited to embark on our next chapter with Ma’aden, which will bring a global scale and strategic aspect to Meridian’s entrepreneurial culture.”
In 2016, a Mauritius domiciled investment fund, Phatisa, acquired one of Malawi’s arguably number one agro- processing group of companies, Farmers World, in a secret deal which sent goose pimples among the company’s 3,000 employees in its 110 branches spread across Malawi.
While there were no official figures mentioned in the ‘trade off’, but a scrutiny of Phatisa’s portfolios in Africa, show that the Farmers World Group of Companies, has been for years under the armpit of the Meridian International Group.
“Our capital and insight were instrumental in developing Meridian’s distribution networks, providing smallholders with access to customised fertiliser blends that continually drove volume growth and resulted in EBITDA (earnings before interest, taxes, depreciation, and amortization, is a measure of a company’s overall financial performance) tripling over our investment period.
during this growth trajectory, we positively impacted over 13,000 smallholders
– 69% of which were women – with our training programmes and technical
assistance facility” Phatisa said on their website.
Paradoxically, the Meridian International Group, is one of Phatisa’s six African portfolios and raked in through a management buyout and expansion in 2014.
A management buy-out is an acquisition in which the acquiring group is led by the company’s own management and executives. In other words the company is bought by its own management rather than by another company or by a group of outside investors.
Other Phatisa’s portfolios in Africa include Farming and Engineering Services Malawi, Goldenlay Zambia, Feronia DRC, Continental Beverage Company Cote d‘lvoire and General Plastics Kenya.