In a press release, TransCorp said a careful review of the long term proposition of its play in the juice concentrate market revealed a number of issues. As a result of this, the Board decided to exit its investment in Teragro Commodities Limited and is currently working together with the Benue State Government, a key stakeholder, towards identifying suitable partners to drive the value proposition of the business going forward.
Furthermore, the company said it reported in its 2017 Annual Report that it expects to close the transaction in a timely manner and maximize benefits for stakeholders and that the decision to exit Teragro will not have any significant impact on the Group’s business as it contributed less than 0.03% of Group revenue and 0.21% of Group assets.
Teragro is the agricultural arm of TransCorp, a diversified conglomerate with interest in the hospitality industry, energy and oil and gas sectors.
The subsidairy which has a plant in Benue State, processes orange, mango and pineapple concentrates for industrial markets. The Benfruit plant is said to have a capacity of 26,500 metric tonnes and is the first and only Nigerian owned and operated juice concentrate processor in the country.
Terargro partnered Coca-Cola in 2014 and began producing concentrates for the soft drinks giant. However, there have been published reports that one of the challenges facing the agricultural firm is the unavailability of raw materials.
TranCorp said that the divestment process is still ongoing and has not been concluded.