The Zambia Privatization Agency (ZPA) is pleased to announce that the Minister of Finance Honourable R D S Penza has signed the Sales Agreement with Mr Josiah Situmbeko Songolo, Mr Mulozi Samuel Lisibani and Mr Greeves Sitwala for the sale of 100% shares in Lyambai Hotel Limited. Lyambai Hotel is a 17 roomed hotel.
The hotel is in the town centre of Mongu, overlooking the Barotse plains and is wholly owned by the National Hotels Development Corporation (NHDC) which, in turn is owned by the Zambia Industrial and Mining Corporation Limited (ZIMCO) (in liquidation).
Lyambai Hotel was built as a residential building and converted into a privately run hotel in the early 1960s. In August 1972, the hotel was nationalised by the Government and has been run by the NHDC.
The hotel has not been refurbished since nationalisation. The Members of the Agency and Cabinet had approved that Lyambai Hotel be sold on the basis of a right of first refusal to the MBO Team.
The ZPA Secretariat evaluated and rejected the MBO bid and consequently the Hotel was offered for sale on a competitive bid basis.
The Lyambai Hotel was twice extensively advertised for sale. The first advertisement received three bidders who are; Mr M Sundano et al, Mr Gunnar Smith, and Management Buy-Out Team.
The ZPA Secretariat evaluated and rejected the bids from Mr Gunnar Smith, and Management Buy-Out Team. Negotiations were commenced with Mr M Sundano but failed.
The second advertisement received a response of three bids from Mr Songolo et al, Senanga Safaris Limited, and Mr M Iluya et al. Mr Songolo et al ranked first while Senanga Safaris Limited ranked second. Negotiations were carried out with the two top bidders and were successfully concluded with Mr Songolo et al.
Mr Songolo is a Zambian national based in Lusaka. He worked for several years in the Zambian parastatals as a senior executive and served on the boards of several parastatals and private companies.
Mr Mulozi Samuel Lisibani is a Zambian national. He worked for several years in the Zambian parastatals as a senior executive. Mr Greeves Sitwala is the Director of Fairview Hotel in Lusaka. Mr Sitwala is a trained hotelier with several years of working experience in the hotel industry.
Mr Songolo et al have purchased Lyambai Hotel for a total consideration of K201.17 million. This consideration comprises:
| K'000 | |
|---|---|
| Payment due to the Privatization Revenue Account | 55,200 |
| Capital expenditure investments | 120,000 |
| Liabilities taken over | 25,970 |
| Total investment package | 201,170 |
In addition Mr Songolo et al have retained all the employees save the three voluntary redundancies regarding the Hotel Manager, Food and Beverage Manager and the Accountant, on the existing terms and conditions of service.
Mr Songolo et al have undertaken that there will be no redundancies as a direct result of this privatization and that they will implement a manpower policy that will ensure that employee development programmes are put in place as stated in the business plan.
Mr Songolo et al are committed to introduce additional facilities at the Hotel. In addition the rooms will be refurbished and redecorated .
The transaction was negotiated by a team comprising an independent Chairlady Mrs Regina Mulenga of Equator Advisory Services Limited, a lady of high integrity appointed by the ZPA Board. The negotiators extensively used the valuation prepared by Deloitte & Touche and achieved an optimum price subject to the valuation.
The acquisition by Mr Songolo et al, of Lyambai Hotel Limited, is yet another demonstration that Zambians are very keen to continue supporting the Zambian privatisation programme through their continued investment activities.
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