Magwa Tea Estate has its first harvest in four years
THERE was ululation, dance and singing when rural development and agrarian reform MEC Mlibo Qoboshiyane led about 900 workers of the troubled Magwa Tea Estate, in Lusikisiki, in harvest.
Eastern Cape Rural Development Agency (ECRDA) chief executive Thozi Gwanya also witnessed the first harvest following four years of dormancy.
The harvest also came after the Grahamstown High Court last year put the tea estate under business practitioners.
The 1 803 hectare farm used to have a turnover of R65-million a season and provided jobs and career training for 1 200 permanent and 2 300 seasonal workers.
After years of plundering, corruption and mismanagement, the estate has shown signs of improvement.
A business rescue practitioner appointed to salvage the collapsed governmentowned entity last year said R160-million was needed.
Provincial treasury has committed to allocate R116-million for the tea estate rescue process to improve production on the incorporated tea estate.
This will add on the R20-million Department of Rural Development and Agrarian Reform has transferred to the business rescue practitioner for interim operational requirements.
Yesterday, Qoboshiyane said the Magwa Tea Estate’s shares have been transferred from the Eastern Cape Development Corporation to his department.
Qoboshiyane said as part of the process to rescue Magwa and Majola tea estates, the provincial government has resolved to issue an expression of interest call aimed at attracting the private sector to invest into the two entities.
“The proposed new shareholding structure of the incorporated tea estate will give the private investor 51% shareholding, 26% to the community, 13% to employees of the tea estate and government will hold a 10% shareholding stake in the tea estate,” he said.
The sought private sector partner will be required to fund the 51% equity share in the approved business plan.
A lease agreement with the community in-lieu of the 26% shareholding may also be considered.