ZAMBEEF Products Plc says it has signed an agreement with Chisamba Ranching and Cropping Limited, a company its former joint-chief executive officer Francis Grogan holds a 50 per cent shareholding, to supply the former approximately 1,480 heads of cattle worth over K7.8 million for 2020.

In a statement availed by sponsoring broker Pangaea Securities Limited, Zambeef contracted Grogan’s company, together with one other supplier, to continue supplying the agro-processing giant with approximately 1,480 heads of cattle worth a monetary value of over K7.8 million, effective, April, 2020.

“Mr John Rabb is one of a class of beneficiaries in Sussex Trust, an organization that owns 100 per cent shareholding in Wellspring Ltd and Francis Grogan is a 50 per cent shareholder in Chisamba Ranching and Cropping Ltd (CRC). The two companies will be contracted to supply cattle to the Company commencing in April, 2020 (and ending December 2020), as they have done in previous years. Based on 2019 supplied quantities, Wellspring is expected to supply approximately 1,343 cattle with an approximate value of K4,600,185 (c. US $260,000) and CRC is expected to supply 1,480 cattle with an approximate value of K7,830,617 (c. US$440,000),” stated Zambeef.

“The cattle supply agreements with Wellspring and CRC fall to be treated as related party transactions pursuant to the AIM Rules for Companies (“AIM Rules”). The Directors of Zambeef, other than Mr John Rabb, having consulted with Strand Hanson Limited in its capacity as the Company’s Nominated Adviser for the purposes of the AIM Rules consider that the terms of these cattle supply agreements to be fair and reasonable insofar as shareholders are concerned.”

According to the statement, Zambeef buys weaners (heifer and steers) culled cows and Bulls from these two suppliers and these are placed in the feedlot for about six months before being slaughtered.

Last year, CRC supplied 1,522 cattle and Wellspring supplied 1,056 cattle.

Zambeef also buys cattle from other traditional and commercial farmers throughout the year.

On average, the Company keeps about 8,000 cattle in the feedlot during the year.