• Strategic Asset Disposal: PPC Zimbabwe Ltd (PPCZ) has agreed to sell the Arlington Estate, a non-core 418-hectare property for US$30 million
• Financial and Operational Benefits: The US$30 million cash consideration, significantly above the property’s R37 million nominal
• Structured Transaction with Safeguards: The Disposal Agreement includes critical milestones, such as Reserve Bank of Zimbabwe approval within 45 days and property transfer registration within 90 days, with automatic lapse if unmet, minimizing execution risks

Harare- PPC Ltd (PPC), through its Zimbabwean subsidiary PPC Zimbabwe Ltd (PPCZ), in which it holds an 88% stake, has taken a significant step in optimizing its asset portfolio by concluding an agreement on 20 August 2025 to dispose of the Arlington Estate, a vacant immovable property in the District of Salisbury, Zimbabwe.

The Disposal Agreement, signed with a privately held Zimbabwean property development company, involves the sale of the 418-hectare Arlington Property for a cash consideration of US$30 million.

“PPC shareholders are advised that the Company has on 20 August 2025 (“Signature Date”) via its 88% held subsidiary, PPC Zimbabwe Ltd (“PPCZ”), concluded an agreement (“the Disposal Agreement”) relating to the disposal of vacant immovable property situated in the District of Salisbury, Zimbabwe, known as the Arlington Estate (“Arlington Property”) to a privately held Zimbabwean company (the “Purchaser”), for a cash consideration of US$30 million (the “Disposal Consideration” and the “Disposal”),” the ompany said in a statement.

This strategic move aligns with PPCZ’s focus on streamlining its operations and divesting non-core assets, as the Arlington Property holds no commercial value for its core cement production business due to the absence of limestone deposits.

The Arlington Property has a complex history, having been acquired by PPCZ in 1990 and zoned for residential, industrial, and commercial activities.

Over the years, it faced multiple expropriation attempts by the Zimbabwean government, culminating in a compulsory acquisition in 2010.

After extensive negotiations with various government ministries and the Office of the President, PPCZ secured the title deed in December 2024.

With the property now unencumbered, PPCZ conducted a comprehensive process to dispose of it at fair value, reflecting a pragmatic approach to capitalising on an asset that no longer serves its operational strategy.

The Disposal Consideration, payable in US dollars, underscores the transaction’s financial significance and provides PPCZ with a substantial cash inflow to support its broader capital allocation objectives.

The Disposal Agreement is structured with clear timelines and milestone events to ensure its successful execution. The transfer of the Arlington Property, along with all associated legal risks and benefits, will take effect upon registration, known as the Effective Date, against the payment of the US$30 million consideration.

milestones include PPCZ obtaining approval from the Reserve Bank of Zimbabwe within 45 days of the Signature Date to declare a special dividend and repatriate proceeds to PPC in South Africa.

Additionally, the Purchaser must pay the full consideration plus VAT to PPCZ’s appointed property conveyancer within 60 days, and the property transfer must be registered within 90 days.

Failure to meet these deadlines will result in the agreement’s automatic lapse, mitigating risks for PPCZ by ensuring the transaction’s timely completion.

Financially, the Disposal represents a significant uplift from the Arlington Property’s recorded value.

In PPCZ’s audited financial statements for the year ended 31 March 2025, the property was recognised as a government grant at a nominal value of R37 million.

The US$30 million sale price, equivalent to approximately R540 million at current exchange rates, highlights the substantial value unlocked through this transaction.

Classified as a Category 2 transaction under the JSE Listings Requirements, the Disposal does not require shareholder approval, streamlining the process and enabling swift execution.

The proceeds will be evaluated within PPC’s capital allocation framework, with considerations for optimizing gearing levels, potentially strengthening the company’s financial position or funding strategic initiatives.

Beyond the financial aspects, the Disposal Agreement includes a strategic component that reinforces PPCZ’s market position in Zimbabwe’s cement industry.

Concurrently, PPCZ and the Purchaser have entered into an agreement stipulating that the Purchaser will exclusively source its cement requirements for any developments on the Arlington Property from PPCZ, effective from the Disposal’s Effective Date.

This arrangement not only secures a long-term customer for PPCZ but also aligns with the Purchaser’s expertise in property development, ensuring that future projects on the Arlington Property will drive demand for PPCZ’s core products.

The Purchaser, described as a non-related party with proven project execution capabilities, is well-positioned to maximize the property’s potential, further enhancing the strategic fit of this transaction.

Thus,  PPCZ’s disposal of the Arlington Property marks a pivotal moment in its strategic evolution, allowing the company to monetise a non-core asset while reinforcing its focus on cement production.

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