TANICA told to secure bank loan for capital injection

DODOMA: THE government has advised the Kagera-based Tanganyika Instant Coffee Public Limited Company (TANICA) to seek a capital injection from the Tanzania Agricultural Development Bank (TADB), as it earlier recommended.

The Deputy Minister for Industry and Trade, Exaud Kigahe said in Parliament yesterday that the government had received TANICA’s request for 8.0bn/- in capital.

This amount was subsequently reduced to 5.0bn/- after an analysis of the capital requirement to boost the company’s operations.

The government then advised TANICA to pursue a loan from TADB. “The board and management of TANICA should proceed with the government’s advice.

They should go to TADB and ask for a loan,” the Deputy Minister said in response to a question from the Member of Parliament for Bukoba Urban constituency, Stephen Byabato who inquired about the progress of the pledged 5.0bn/- capital injection.

The Deputy Minister further explained that the TANICA Coffee Factory is primarily owned by the Kagera Cooperative Union (KCU), holding 53.37 per cent.

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Other significant shareholders include the Karagwe District Cooperative Union (KDCU) with 31.83 per cent, the Treasury Registrar at 7.67 per cent, the Tanzania Federation of Cooperative (TFC) with 6.22 per cent and TANICA employees holding 0.91 per cent.

The Deputy Minister said the government conducted an assessment of the factory and discovered that it lacked a proper Board of Directors and effective management.

Consequently, the government oversaw the formation of a new Board of Directors and the factory is now implementing various recommendations provided by the government.

The government will continue to collaborate with the factory’s major shareholders to identify a capable investor who can inject additional capital into TANICA, he said.