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Afgri to sell lending book to Land Bank

Sep 14 2011 09:34 I-Net Bridge

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Johannesburg - Grocap, a subsidiary of Afgri Operations , is to dispose of its farmer lending book to the Land and Agricultural Development Bank of South Africa.

Afgri Operations is a subsidiary of JSE-listed agricultural services group Afgri [JSE:AFR].

The latter said on Tuesday that the transaction would improve its financial position and gearing as well as increase its access to funding, allowing the group to pursue other profitable opportunities with the capital realised from the sale of the farmer lending book.

"Afgri and Grocap have strong and established relationships with farmer clients that they want to retain and grow, and wish to continue offering financial services, at the current standard of service, to new and existing farmer clients alongside their other products and service offerings; and Grocap has the capacity and infrastructure to act as an agent of the Land Bank in respect of the administration functions relating to the farmer lending book," the group explained.

Grocap will continue to originate farming debt in its own name but will, from time to time, offer to sell to the Land Bank such farming debt as meets Land Bank's eligibility criteria, and will also administer the farmer lending book on behalf of the Land Bank.

 
land bank  |  afgri
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