New fund seeks prescribed asset status

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THE recently launched Stratus commodities fund says it is seeking prescribed asset status and liquid asset status, in its quest to attract liquidity to the agriculture commodities sector.
The fund, launched by Stratus Capital Partners, will be listed on the Financial Securities Exchange (Finsec) and will, according to Stratus, offer solutions to farmers against post-harvest losses.
It seeks to raise US$50 million.
The bill for post-harvest management in Zimbabwe is currently at US$900 million.
It is estimated that Zimbabwean farmers lose 30 percent of their produce to inadequate post-harvest management systems.
“This fund is for farmers who find themselves stuck at the end of the season with commodities they can’t sell. In previous years, there has always been an issue with where to take the commodities, who is going to buy the commodities, and at what price.

“We were invited by ZMX (Zimbabwe Mercantile Exchange) to provide the solution for that, and by creating a commodity fund, we are now going to provide liquidity into the market for farmers in particular.
“We are going to channel that liquidity from the capital markets; pension funds, insurance companies, banks, individuals, etc. Pension funds in particular have been investing in brick-and-mortar.
“They have been buying buildings, and building cluster homes. That sort of thing is good for preserving value, but it doesn’t enhance the value that they have,” Stratus Capital Partners chief operating officer, John Bere, told the media last week.
“So pensioners, at the end of the day, will not be paid a handsome return because the money remains the same as when they initially contributed to the fund.
“Pension funds are also now inundated with a lot of buildings and you will appreciate that the country is awash with empty office space so the return on that sort of investment is not there.
“So we are offering an alternative investment to pension funds so that they can start earning a real income as we are trading.”
Finsec operates the ZMX, which was founded as a joint venture between TSL and CBZ Holdings and supported by the government.
Finsec undertook the technical implementation of setting up the exchange.
Stratus says it believes that the Zimbabwean commodities market presents significant opportunities for growth and value creation.
“However, actual results may differ materially from those anticipated in these forward-looking statements.
“Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements include but are not limited to, market conditions, the performance of the Zimbabwean economy, fluctuations in currency exchange rates, political instability, natural disasters, and other risks and uncertainties described in this memorandum and in other documents that we file with regulatory authorities,” the company said in the fund’s prospectus.