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Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria
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Cassava at Agbara Estates by LandAfrique. A Homestrings investment opportunity in agriculture Nigeria

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This is an investment opportunity in Nigeria, with LandAfrique, the developer of the largest cassava fully mechanized farm. A landmark project for West Africa's agribusiness: the first fully …

This is an investment opportunity in Nigeria, with LandAfrique, the developer of the largest cassava fully mechanized farm. A landmark project for West Africa's agribusiness: the first fully integrated industrial cassava operation in Nigeria. Largest mechanized farm in Nigeria on 4,000 hectare of land. Co-located with a state-of-the-art processing plant to take advantage of high market demand for starch & glucose syrup. Bio-gas and renewable energy generation.

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  • 1. Nigeria’s industrial vertically integrated cassava project Agbara Estates by LandAfrique London, United Kingdom March 2014
  • 2. Disclaimer The information contained in this presentation or subsequently provided to any recipient of this presentation whether orally or in writing by or on behalf of LandAfrique Agro Limited or its respective employees, agents or consultants (Information) is provided to the recipients on the terms and conditions set out in this notice. The purpose of this presentation is to provide recipients with information relating to LandAfrique Agro Limited. This presentation has been prepared by LandAfrique Agro Limited and each recipient must make his/her own independent assessment and investigation of LandAfrique Agro Limited and its business and assets and should not rely on any statement or the adequacy and accuracy of any information. The material in this presentation (“material”) is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase any security in LandAfrique Agro Limited nor does it form the basis of any contract or commitment. LandAfrique Agro Limited makes no representation or warranty, express or implied, as to the accuracy, reliability or completeness of this material. LandAfrique Agro Limited, its directors, employees, agents and consultants shall have no liability, including liability to any person by reason of negligence or negligent misstatement, for any statements, opinions, information or matters, express or implied, arising out of, contained in or derived from, or for any omissions from this material except liability under statute that cannot be excluded. Statements contained in this material, particularly those regarding possible or assumed future performance, costs, dividends, production levels or rates, prices, resources, reserves or potential growth of LandAfrique Agro Limited , industry growth or other trend projections are, or may be, forward looking statements. Such statements relate to future events and expectations and, as such, involve known and unknown risks and uncertainties. Actual results and developments may differ materially from those expressed or implied by these forward looking statements depending on a variety of factors. LandAfrique Agro Limited invites interested parties to view and review their further data on request and signature of a formal confidentiality agreement.
  • 3. The first fully integrated industrial cassava operation in Nigeria • Largest mechanized farm in Nigeria on a 4,000 hectare of land owned by the group • State-of-the-art processing plant, co-located with the farm • The Company owned by the Lawson Group- a diversified conglomerate with a 50-year track record of business in Nigeria and West Africa • High market demand for end products- starch & glucose syrup • Soya as fallow crop-brings additional revenues besides enhancing soil fertility • A bio-gas plant supplements energy; reduces effluents • Attractive cash flows and profitability with a short payback period A land mark project for Nigeria:
  • 4. • Incorporated on May 2, 2012 to undertake fully-integrated agricultural business • 4000 ha of land for the project is owned by the Group • The integrated cassava project consisting of: • CASSAVA SEED FARM PROJECT & CASSAVA FARM PROJECT • PROCESSING PLANT & BIO-GAS PLANT • Progress to date includes acquisition of planting material and starting of planting for Seed Farm LandAfrique is owned by the Lawson Group, a family owned Nigerian conglomerate, founded in 1959 with a 50-year track record of doing business in Nigeria: REAL ESTATE DEVELOPMENT - AGBARA ESTATES LIMITED Oldest private sector integrated development in Nigeria. Home to 27 factories Tenants include: Nestle, Unilever, GlaxoSmithKline and Procter & Gamble OIL AND GAS TRADING - ACORN PETROLEUM PLC 26-year track record in Nigeria International trade of petroleum products Extensive footprint in Nigeria including: 16 Retail outlets and 30,000mt storage facilities Lawson GroupL Company overview
  • 5. Mr Tunde Akindele, MBA. - Director 20-year business track record in Nigeria Managing Director of Kinda Associates, a Nigerian haulage, travel and management consulting business Handled Personnel functions , credit administration and public relations in a large hospital Miss Nibukun Lawson - Chairman She is a Chartered Accountant and has worked at KPMG in London and Paris Has experience working in Corporate Development at Ecobank Transnational Incorporated Has previously worked as a Finance Director at Vitamalt Plc Currently overseeing all the finance functions for the Lawson Group Mr Nadhan K Ramachandran, MBA.- Managing Director Over 30 years experience in finance, manufacturing and agriculture with core area in business strategy Held senior management role on National Dairy Development Board, responsible for India’s milk revolution Formerly General Manager of The Industrial Finance Corporation of India Ltd-IFCI Ltd (12 years) Ex-Director on the board of Indian Dairy Machinery Manufacturing Co. Ltd Mr Jaiye Senbanjo, MSc. Agronomy – Executive Assistant to the Managing Director 5 years experience as agronomist in rubber and palm oil plantations in West and Central Africa Extensive knowledge on pest management and crop protection & field experience in beef production Mr Arif Deshmukh, BSc. Agriculture - Farm Manager Relevant experience as farm manager in a cassava cultivation and starch production in Nigeria Long experience working as agricultural consultant for plantation development Start-up management team
  • 6. Project Location • 40 Km from the capital city Abuja • Excellent access via Abuja-Keffi main road • 4000 hectare project site acquired • Ideal land for cassava cultivation Nigeria Project Site Ideally located….
  • 7. The Integrated Cassava Project Phase 1 Phase 2 Phase 3Project designed to have three phases to achieve de-risking of perceivable risks Totally balanced, integrated and synchronised One-time Seed Farm for providing planting material for the main farm in the 2nd year. Main farm will start providing the required raw material for the plant from 3rd year onwards when the plant will be commissioned Seed farm, main farm and factory-all will be co-located at Keffi A biogas plant: to utilise bio waste of effluents, will save energy costs while addressing effluent concerns Soya as fallow crop: adds soil fertility and bring additional revenues SEEDFARM ••400Hectares ••Productionof planting material FARM ••4000ha,Fullyowned ••Fullymechanized ••50%owncultivation ••50%onleaseto farmers PROCESSING PLANTS ••StarchPlant ••GlucosePlant ••BioGasPlant ••Diversifiedend products Q-1, 2014 Q-2 ,2015 Q-1, 2015 Q-2, 2016 Q-4, 2014 Q-2, 2016 Totally balanced, integrated and synchronised
  • 8. Phase 1: Cassava Seed Farm • Seed Farm covers 400 ha , fully mechanised farming operations ; being developed during Q1-2014 to Q2 2015 • Designed to produce planting material for Phase 2- Main Cassava Farm • Both the land for the integrated project and the Seed Farm- being fully funded by the current shareholders • 4000 ha of land owned by the group valued on lease rental basis at ₦ 1885 mn or US$ 11.855 mn Funding by Promoters Ensuring desired variety of planting material…. Phase 1 Phase 2 Phase 3 SEEDFARM ••400Hectares ••Productionof planting material FARM ••4000Hectares ••Fullymechanized ••Fullyowned ••50%own cultivation ••50%onleaseto farmers PROCESSING PLANTS ••StarchPlant ••GlucosePlant ••BioGasPlant ••Diversifiedend products Q-1, 2014 Q-2 ,2015 Q-1, 2015 Q-2, 2016 Q-4, 2014 Q-2, 2016 Item ₦ (Mn.) US$ (Mn.) Land 4000 ha 1885.000 11.855 Seed Farm @ 223.000 1.403 Land & Seed Farm 2108.000 13.258 @ Equipment, infrastructure, op. expenses, R&D
  • 9. Phase 2: Cassava Main Farm • 4000 hectare cassava farm fully mechanised • The farm will produce a minimum of 120,000 tons of fresh cassava tubers annually • This meets the full requirement of cassava tubers for the plant (400 tons per day) to support 50 tons per day of starch and 50 tons per day of glucose syrup production in 300 days a year Funding Requirement 50% own cultivation: ensuring stability 50% leasing to farmers: ensuring inclusive growth by farmers’ participation…. Phase 1 Phase 2 Phase 3 Item ₦ (Mn.) US$ (Mn.) Farm Equipment 333.450 2.097 Farm Infrastructure 430.475 2.708 W.Capital & Fixed Costs 801.107 5.038 Total 1565.032 9.843 Q-1, 2014 Q-2 ,2015 Q-1, 2015 Q-2, 2016 Q-4, 2014 Q-2, 2016 SEEDFARM ••400Hectares ••Productionof planting material FARM ••4000ha,Fullyowned ••Fullymechanized ••50%owncultivation ••50%onleaseto farmers PROCESSING PLANTS ••StarchPlant ••GlucosePlant ••BioGasPlant ••Diversifiedend products
  • 10. • The cassava starch & glucose factory is 400 tons per day capacity of fresh cassava tuber • State-of-the-art plant for the production of 2.5 t/h of cassava starch and 2.5 t/h of adjunct syrup from cassava starch slurry [Annual production: 15,000 tons of starch and 15,000 tons of syrup] • The factory is a co-integrated with biogas plant which will supplement energy requirements from LPFO with biogas for heat generation. This will ensure energy efficiency & environmentally friendly Phase 3: Processing Plants Funding Requirement Bio gas plant for treating effluents & energy…. Item ₦ (Mn.) US$ (Mn.) Plant & Equipment 2,843.830 17.885 Biogas Plant 309.195 1.945 Civil Infrastructure 999.000 6.283 W. Capital & Fixed Costs 918.699 5.778 Total 5,070.724 31.891 Q-1, 2014 Q-2 ,2015 Q-1, 2015 Q-2, 2016 Q-4, 2014 Q-2, 2016 Phase 1 Phase 2 Phase 3 SEEDFARM ••400Hectares ••Productionof planting material FARM ••4000ha,Fullyowned ••Fullymechanized ••50%owncultivation ••50%onleaseto farmers PROCESSING PLANTS ••StarchPlant ••GlucosePlant ••BioGasPlant ••Diversifiedend products
  • 11. ➢ Third most important source of food calories in tropical countries after rice and maize ➢ Good resistance to drought, disease and pests ➢ Very productive - each plant can produce 5-6 kgs of tubers in a season ➢ Due to high water content (60- 65%), tubers are perishable and thus need to be processed near production site. ➢Cassava-UNCTAD.org Africa contributes more than a half of the global supply Asia contributes a third of world production Latin America and the Caribbean contribute one-fifth of world production ••A third of African production is from Nigeria- largest world producer with 45 mt ••Leader-Thailand (30 mt) ••Leader- Brazil (25 mt) World Production is approx. 250 million tons (mt) 90% of production consumed as food constituting about 50% of energy requirements of Nigerians…. Why Cassava?
  • 12. Industry outlook
  • 13. Value-added Chain Estimated Demand (tons) Fresh cassava tubers required (tons) Incremental Area (@25t/ha) Starch 230,000 1,150,000 46,000 *Sweeteners 190,000 950,000 38,000 Source: Nigeria Cassava Transformation Action Plan 2012 * Assumes 50% replacement of imported sugar in the sweetener industry Federal government’s Cassava Transformation Plan estimates requirement of additional 12.8 million tons of cassava tubers for value-added products (Starch /Flour/ Sweeteners/ Dried Chips/ Fuel Ethanol/ High Quality Garri) which require incremental cultivation in an area of 510,000 ha. It is estimated that the demand of starch and sweeteners in the country is of the order of 230,000 tons and 190,000 tons respectively as below: The Nigerian Market “Nigerian cassava-based industrial products are just a fraction of imports: the growth potential is huge”
  • 14. Thickeners Bouillon Fillers Soups, tablets, face creams and pharmaceuticals Binders In sausages, processed meats Stabilizers Ice cream Product Applications….. Multifarious uses for edible Starch….
  • 15. • About 85% of requirement of Starch and 100% of Glucose Syrup in Nigeria is met by imports. Therefore, the products of the company are import substitutes • There are only two existing large players in the starch industry which collectively can meet only 8% of the annual demand • Only one company in Glucose syrup industry which is presently non-operational. • The cassava starch / sweetener industry has strong entry barrier- requiring large own land area for cultivation to meet assured tuber supply for processing Demand-Supply Gap for Starch and Modified Starch Present demand mostly met by imports: therefore products of the company substitute imports....
  • 16. A compelling investment
  • 17. The Investment in the integrated project is estimated to cost ₦ 8,744 million (US$ 55.0 million) as under: The promoters of the project would provide equity towards the cost of Land (valued based on the lease rentals) and the cost of Seed Farm. Investment in the Project Sr. No Description Cost ₦ (mn.) US$ (mn.) 1 Land 1,885.000 11.855 2 Seed Farm 223.000 1.403 3 Main Cassava Farm 1,565.032 9.843 4 Starch & Glucose Plant 4,761.529 29.946 5 Biogas Plant 309.195 1.945 Total 8,743.756 54.992
  • 18. The estimates on profitability for the Farm and Processing Plant operations for the next 10-year period show attractive returns The average annual revenues are estimated at ₦ 1,169 million (US$ 7.35 million) for the Farm operations and ₦ 3,937 million (US$ 24.76 million) for the Processing Plant operations The farm is expected to generate an average annual cash flow (PBDIT) of ₦ 493 million (US $ 3.10 million) and the Processing Plant ₦ 2,408 million (US$ 15.14 million) The Return on Investment (ROI) for the overall project is estimated to be 31% and the IRR 36% Profitability Projections
  • 19. Profitability Projections Projects Yield / Cap. IRR CASSAVA FARM Normal expected yield 30 tons/ ha 26.9 Sensitivity parameter - reduced yield 24 tons/ha 20.3 STARCH & GLUCOSE PLANT Normal expected cap. utilization 70%- 95% 40.4 Sensitivity: reduced cap. utilization 56% -76% 26.6 The estimates on profitability for the Farm and Processing Plant operations for a 10-year period show attractive returns. The Internal Rate of Return (IRR) for the Farm and Processing Plant works out to 26.9% and 40.4% respectively under expected operations. Under unforeseen stressed operations (sensitivity analysis), the IRR is still attractive at 20.3% and 26.6% respectively. The IRR for the overall project is estimated at 36%
  • 20. LandAfrique Agro’s Journey towards healthy, eco-friendly food options…. LandAfrique Agro plans to devote a part of its resources towards R & D activities with the main objective of developing crops & products that are more eco-friendly and that provide healthier food options worldwide. LandAfrique Agro R&D
  • 21. How can you get involved? • Invest – access the deal and make a commitment homestrings.com/VehiclePreview/a03F0000009uUV1IAM • Promote – Your own project, fund or bond on Homestrings • Participate – Diaspora Investment Symposium – Investing in East Africa, July - London
  • 22. Contacts • Eric V. Guichard – Founder and CEO eric@homestrings.com service@homestrings.com • Web: www.Homestrings.com • @Homestrings & facebook.com/Homestrings

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