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Monday, January 31, 2005 - Web posted at 7:39:40 GMT Financial 'blip' blamed for delay of million-dollar marble factory LINDSAY DENTLINGERSHAREHOLDERS of Namibia Stone Processing have downplayed reports that a lack of operating capital is stalling the opening of a marble and granite processing company at Omaruru. |
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Italian specialists were expected to arrive in the country last week to begin preparing millions of dollars worth of machinery for operation. The massive N$53 million factory, situated at the entrance of the town, is touted to become the biggest of its kind in the region - producing mainly high-quality tiles and table tops for export. Among those involved in the project is controversial businessman Michael Goagoseb. Sources have indicated to The Namibian that the project was struggling to obtain financing from local banking institutions, because it would allegedly take too long for the loan to be repaid. "It [financing] is a problem, but it is not that we haven't started because the money is not available. The machinery is not ready," Former Agriculture Minister Helmut Angula, who is a shareholder and "promoter" of the project, said upon enquiry from The Namibian. Angula said the company needed between N$6 million and N$10 million as operating capital. Sources have indicated to The Namibian that the project was struggling to obtain financing from local banking institutions, because it would allegedly take too long for the loan to be repaid. According to the shareholder's information with auditors Deloitte and Touche, the project is a collaboration of Shigwana, businessman Michael Goagoseb, the Defence Force Foundation, Angolan national Lourenco dos Santos and Angolan company Sociedade Minespre-Mineracaode Pedras Semi-Preciosas. However, The Namibian understands that as many as 10 individuals, some of them prominent Namibian figures like Angula, are part of the venture, although not listed individually on any formal documents. Omaruru businessman Herbert Kempkes, who runs marble works at the town, will assist in the production. Last year Goagoseb was thrust into the limelight when he was implicated in at least two deals in which he acquired prime land for a song from the municipality, based on the premise that it would be used for development purposes. He sold a game park he acquired in this way for a 1 000 per cent profit to Kempkes. The composition of the Defence Force Foundation could not be verified. Omaruru Municipality Public Relations Officer Frans Goaseb said upon enquiry from The Namibian that the company "definitely" paid for the land on which the factory has been built, but could not disclose the amount. He said it was bought based on "negotiations" with the municipality and the investment it would bring to the town. According to a major shareholder and interim CEO of the company, Oscar Shigwana, the project was well on track, but that it was too early to say when the company would start with full production. He told The Namibian that the start of production was dependent on a battery of tests that still had to be carried out, and not because of the need for finances. Shigwana said the purchase of the machinery from Italy had included costs to set it up and to conduct the necessary steps to put it in operation. "We have the whole year. It is highly capital intensive. We can't do it overnight," he said. Once operational, about 70 people are expected to be employed. Shigwana said electricians and mechanics had already been employed and would be roped into the testing phases of the project. Despite still sourcing sufficient financial backing, both Angula and Shigwana are confident of the project's success, saying they were eying markets in Asia, the United States and neighbouring countries for their finished products. "Everything we're planning is in place. We are monitoring everything," said Shigwana. He said the factory would gradually begin production once the machinery was in operation, and said it was too early to tell when it hoped to start producing its first products. "We have the whole year to upgrade, look at water and electricity consumption, operational costs, looking at the material ...," said Shigwana. The company said it had already entered into agreements with local quarries for the supply of raw material and also planned to make use of second-grade raw material for lower quality products. The factory will operate in two production units - one for the processing of marble and the other for granite. |
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