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SHONGA FARMS HOLDINGS LTD: MATTERS ARISING

The foundation of Shonga Farms Holdings Ltd (SFH) was laid during the administration of Dr Bukola Saraki as the Governor of Kwara State, when he made overtures to 13 displaced farmers from Zimbabwe for investment in Nigeria. It will be recalled that the white farmers who were displaced as a result of land ceding programme of President Robert Mugabe of Zimbabwe, abandoned their farms practically bare as they feared for dear lives.

The State government then acquired 14,000 hectares of land with additional 1,000 hectares as demonstration farm. It is on record that adequate compensation was agreed and paid to the local land owners by the Government. Each of the 13 farmers was allocated 1,000 hectares (on leasehold interest for 25 years) under distinct and separate companies duly registered in Nigeria.

The Kwara State Government granted the sum of 250 thousand US Dollars to each farmer as loan as a result of their deprived and desperate situation when they arrived Nigeria. This money was applied for opening up of barren lands, cultivation, working capital, acquisition of plants and machinery, private residence and warehouse among others.

When SFH was incorporated as a limited liability company, the seed capital and land provided by Kwara State Government was capitalized and converted to equity of 25% shareholding. The 5 banks (Guaranty Trust Bank (GTB), First City Monument Bank (FCMB), Unity Bank, Keystone Bank and Access Bank through Legacy Intercontinental Bank) which partnered in the packaging of the funding of the farms holds 75% (at 15% each) shares of SFH.

SFH (as owned by KWSG and the 5 Banks), subsequently acquired 60 per cent of the shares of these individual farmers’ institutional investors.

Therefore no private individual holds a single share in the SFH.

In the event of exit by any of the farmers, the percentage of shares held by Kwara State Government in such farm automatically reverts to the Government which can keep it or sell to other interested farmers.

At present, SFH is structured along three major syndicates, which are Poultry Syndicate, Diary Syndicate and Mixed Crop Syndicate.

The Poultry Syndicate has a total capacity to raise 160,000 birds on weekly basis. It has a fully automated modern abattoir to dress 5,000 birds daily. The entire farm production is all fully integrated both back and forward. The farmers produce feeds for the birds on the farm. The farmers grow both the soya beans and maize required for the production of the feeds. They also procure from the local farmers in the event of any short fall. With this, the farm has enhanced quality of lives and contributed to the reduction of poverty in the community as this means an indirect empowerment programme for the people.

On annual basis, the Farm purchases a minimum of 520 million tons of grains from the local market. Besides, the farm provides direct employment for between 1,800 to 2,500 populations of the villagers at the peak of farming season at Shonga. The local farmers equally benefit from the methods of modern farming, especially in cassava planting. The cassava hectarage among the local farmers have remarkably increased due to the assurance of readymade market for them.

The farm has been used by the Federal Government as demonstration farm not only to grow high quality cassava stems but also used as a training ground for local farmers for high quality cassava production. The success of the group has attracted multinational companies to source their cassava requirement from Kwara State, while some of them are even making direct investment on cassava within the state. It is on record that Shonga Farm is the first Nigerian company to have successfully exported high quality Cassava chips to China and Israel. Nigeria Starch Mill in Anambra State and Thia Farm and subsidiary of Nigeria Flour Mills are at present sourcing their Cassava needs from Shonga.