A new joint investment between Norfund and Zebu Investment Partners aims to strengthen the food value chain in Mozambique, catalyzing the creation of more jobs and increased food security in the country.
Norfund has signed a 6 million USD equity investment in Terramar, an importer, distributor, and wholesaler of frozen and chilled foods, drinks and other fast moving consumer products to the formal and informal markets. Terramar is headquartered in Maputo, the capital of Mozambique. The investment is in partnership with Zebu Investment Partners, a private equity fund operating out of Johannesburg and Accra, who signed a 12 million USD equity investment.
The joint investment aims to secure an important player in Mozambique’s food supply chain. By increasing sourcing from local and regional markets, one of the goals is to contribute to the development of local supply chains In Mozambique and reduce reliance on imports. Eventual expansion of the company will also reach areas of the country that are generally underserved.
Despite progress in the country, a large proportion of Mozambique’s population is malnourished, and the country is dependent on food imports. However, the country has vast potential to increase food production through increased productivity in the agricultural sector.
Terramar is one of Mozambique’s largest wholesalers of food, as well as a distributor of household general merchandise, such as paperware and cleaning materials. A large part of their products is currently sourced internationally and regionally, including from Europe and South Africa, but Norfund sees great opportunities for growing the share of the sourcing from domestic and other regional producers.
Terramar also has one of the largest capacity freezers in Mozambique. These kinds of cold chains are crucial for reducing food waste, and thereby contributing to food security.
“Norfund aims to invest in companies that give farmers, processors, and manufacturers access to markets for their products. We believe that Terramar can be an important catalyst for the development of the value chains needed, making further investments in the sector viable,” said Regional Director for Southern Africa in Norfund, Mr Simbah Mutasa.
Norfund will be an active owner, in close cooperation with Zebu, and will nominate a member to the board who will contribute to the professionalism of the business and add technical and governance competencies. Terramar has well-managed operations with key infrastructure in place. The company has one of the largest cold storage capacity in Mozambique. Terramar’s main customers include supermarkets, wholesalers, hotels, restaurants, catering companies and the informal market. Terramar also has its own in-house brands: Nutro for foods and Newfresh for non-edible groceries.
The food and beverage market in Mozambique was estimated to be 1.4 bn USD in 2020 and is projected to grow up to 2.4 bn USD by 2025. Norfund sees great potential for further growth for the company. Terramar supplies customers with quality, affordable products. By contributing to the development of the company we can create more much needed jobs, while increasing Mozambique’s food security,” said Mr Mutasa.
For more information on Norfund visit www.norfund.no