Tanzania’s METL Group Eyes Other African Markets As Middle Class Grows

Tanzania’s METL Group Eyes Other African Markets As Middle Class Grows

By Fumbuka Ng’wanakilala | From Reuters

Manufacturing and trading firm Mohammed Enterprises Tanzania Ltd, one of the country’s biggest private employers, said on Friday it would invest $250 million to expand its business in Africa to capitalise on a growing middle class demand.

Chief Executive Officer Mohammed Dewji also told Reuters he was upbeat about prospects in Tanzania, whose economy has been growing at about 7 percent a year and which he said could accelerate to 10 percent as natural gas finds were exploited.

Despite the global financial crisis, African economies have recorded some of the fastest growth rates outside Asia, creating a bigger middle class and drawing local and foreign investment.

“Our vision is that by 2020/21, we want to be a $5 billion revenue company,” said the CEO of the firm also known as METL Group. Revenue was expected to reach $1.9 billion in 2014/15.

Regarding plans to invest $250 million over two years, Dewji said: “Half of this … will be our equity and the other half will be raised through banks.”

Tanzania’s capital market authorities have been trying to encourage family-owned firms like METL Group to list, saying it would offer cheaper financing. But many such firms are reluctant to cede control to outside shareholders.

“I don’t see us listing on the stock exchange in the near future,” said Dewji. “We are still building the company.”

Read more at Reuters