The Botswana Public Officers Pension Fund (BPOPF) and Messidor Investment have been given a nod by the Hilton Group to go ahead with the construction of the hotel worth P300 million. The approval comes after the Hilton Group was impressed with the mock-up room that was constructed to display the interior design of the rooms.
The Mock-up room was commissioned by the group to ensure that the new hotel will have the same look and feel like other Hilton hotels so as to maintain consistency. Furthermore, the mock-up room was necessary for the Hilton Group to ascertain if the first Hilton Hotel in Botswana meets their standard global brand. At a press briefing, it was revealed that the Hilton Group has inspected the mock-up room and gave a go ahead after making comments and suggestions.
“We have reached a milestone with our Hilton Hotel project following approval by the Hilton Group. The project now commences and we will be working on a strict schedule,” said Ms. Boitumelo Molefe, BPOPF CEO. Ms. Molefe was accompanied by Mr. Victor Senye and Harry Fleetwood-Bird, both from Messidor Investment, the company that will be managing the project. Mr. Senye reiterated the BPOPF CEO’s words that they have reached a real milestone in terms of the development of the hotel.
“We have met the specifications by the Hilton Group through our mock-up room and they have approved the specifications as it meets the set quality assurance standards,” explained Mr. Senye before adding that following the Hilton Group’s review, the real work now begins. “Through the mock-up room we gave them a feel of the product. Now we have to pull up our sleeves and deliver.”
The mock-up room will be demolished as construction commences in full force. Messidor Investments has tapped GM Five as the main contractor for the development of the two buildings. According to Mr. Senye, the development consists of offices and the hotel with both structures to be built concurrently. It was also revealed that the envisaged 4-star hotel will have a total of 153 rooms made up of 6 suites and 147 standard rooms. Situated at the heart of the nation’s new central business district (CBD), the Hilton Hotel will attract travelling business people, and the addition of offices by the developer will enhance convenience.
The media was taken on the tour of the mock-up room to give them exclusive view of how the hotel rooms will look after construction is complete. During the inspection of the room, it was also explained the process that went behind building the structure. Mr. Harry Fleetwood-Bird says in constructing the hotel, the Hilton Group’s brand standards had to be adhered to so as to maintain consistency with rest of the Group’s hotels.
“The Hilton Group is strict on its brand globally, and they want to maintain the same look and feel. Even the sizes of the rooms are determined by the Hilton Group. This mock-up room has been designed to match the Group’s specifications.” Mr. Fleetwood-Bird said that although it is a 4-star hotel, the materials to be used in the rooms are of the highest quality, a development which easily puts the new hotel on par 5-star hotels. Perhaps to emphasize his point, Mr. Fleetwood-Bird said the doors to be used are one of a kind and not readily available in Africa, and indication of the Hilton Group’s strict specifications on maintaining consistency.
The hotel which is expected to be completed by end of November will feature state of the art technology that will ensure that the hotel is eco-friendly and they have gone to great lengths to ensure that each room will be sound proof to prevent disturbances to guests. “Of course in a project of this size there will invariably be delays but we are fortunate not to have experienced major delays except for the recent rains but we are in talks with the main contractor to push the schedule up which might involve working at night,” explained Mr. Fleetwood-Bird.
It is expected that after the main contractor finishes with the construction in November, the second phase will involve interior fittings and commissioning of the hotel staff, and then followed by a testing phase to see if everything works according to plan. The process is estimated to take three months, meaning the hotel will be fully operational in early 2018.
Meanwhile, Mr. Fleetwood-Bird says by meeting the Hilton Group’s specifications regarding the development of the hotel, they have not deviated from BPOPF’s clear instructions which required that there should be strong citizen participation in the project. “BPOPF is strict about citizen participation, and that involves buying locally. We have more than 300 citizens on site,” he said and added that a balance had to be made in relation to meeting Hilton Group’s demands and those of BPOPF.
The P300 million Hilton project was commissioned in 2015 after BPOPF signed an agreement with the Hilton Worldwide for the first Hilton Hotel in the country. Around that time, it was announced that the 4-star hotel will be called Gaborone Hilton Garden Inn Hotel and the project was to be managed by Flemming Asset Management. However relations between BPOPF and Fleming broke down last year amid allegations of Flemming sidelining local contractors, an occurrence that went against BPOPF’s wishes.
Matters soon took a turn for the worst when BPOPF cancelled contracts worth billions with Flemming on the back of a financial scandal that hit the company. There were unconfirmed allegations that BPOPF’s funds managed by Flemming might have been exposed to unnecessary risk. Despite the fall down between the parties, BPOPF agreed to keep Flemming as a project manager for the hotel development.
The decision was short lived as BPOPF ended up severing all ties with Flemming, announcing that the Fund has been working with Fleming on transitioning the development of the Hilton to its property manager Messidor Investment. Ms. Molefe at the time explained that given the magnitude of the project, it was critical that the transition is as smooth as possible.
Messidor Investment, a joint venture between Botswana Insurance Fund Management (BIFM), Stocker Fleetwood-Bird and Haighs Investments, is a special purpose vehicle responsible for managing the property portfolio of BPOPF. On the other hand, BIFM is a subsidiary of the financial giant Botswana Insurance Holdings Limited. BIFM also manages some of BPOPF’s billions. Haighs Investments is a property development company managed by Mr. Senye, a former BIFM CEO. Stocker Fleetwood-Bird specialises in property consultancy, development and valuations. The company is partly owned by Mr. Fleetwood-Bird.
In the coming months prices will go up and inflation will shoot sharply above the target of 3 percent to 6 percent towards the third quarter of 2021, the Bank of Botswana on the other hand will continue to withhold its knife on the Bank Rate. This is according to a forecast made by Kgori Capital in its recent Market Watch Segment.
Statistics from Statistics Botswana show that the recent 1.8 percent increase in the September inflation, from 1 percent in August, was a reflection of the upward adjustment in public transport fares (Transport (from -6.9 to -3.9 percent) in September 2020, which is estimated to have increased inflation by approximately 0.64 percentage points.
Local anti-trust body, Competition and Consumer Authority (CCA), this month received back to back acquisition proposals from South African clothing retailers to wipe out their former rivals, Edcon, from Botswana malls.
Last week BusinessPost was in possession of Merger Notice No 23 of 2020 whereby a South African clothing retailer owner, Retailability Proprietary Limited, through Oclin Proprietary Limited, proposed to acquire parts of the Edgars business conducted by Edcon in Botswana (through Edcon Botswana), as a going concern, consisting of certain assets and identified liabilities.
South African government’s Business Rescue Practitioners earlier this year announced that Retailability will buy Edgars, after the latter filed for a business rescue plan in April after it failed to pay suppliers. This move will see Retailability add Edgars to its portfolio consisting of brands such as; Legit, Beaver Canoe and Style.
Retailability landed on Botswana shores 18 years ago with its flamboyant urban fashion Style which had 17 stores. Style, having almost the same target market as Edgars as it offers men’s and ladies’ contemporary and formal fashion, gave the 91 year old legendary clothing retailer a run for its money, and has won the battle as its parent company has taken over Edgars.
Retailability brands are synonymous with Botswana shopping centres and there are currently five (5) Beaver Canoe stores, 10 Style stores and seven (7) Legit stores across this country. The Beaver Canoe stores sell clothing apparel for men and boys only. The Legit stores have a fashion store format which focuses on the retailing of clothing, footwear, accessories, colour cosmetics and cellular products.
Retailability operates in over 460 stores across South Africa, Namibia, Botswana, Lesotho, and Eswatini. Many observers suggest that because of the deal with Retailability to swallow Edcon, most Edgars stores in Botswana will change their name and be branded Style. A sad tale for religious consumers of the Edgars trademark who got used to love their favourite brand for years.
According to CCA’s Merger Notice No 23 of 2020, Retailability is controlled by Clifford Raymond Lines (through a company which functions solely as a holding company of his interests in Retailability) and Metier Investment and Advisory Services Proprietary Limited (“Metier”). Metier is a private equity enterprise with investments in a number of industries spanning from healthcare, hospitality, FMCGs and telecommunications.
Retailability directors are mostly South Africans; Clifford Raymond Lines, Mark Richard Friday and Norman Victor Drieselmann. Only Nasreen Essack, who was appointed February this year, is a Motswana. He comes after Brian Thuto Tsima left on the same date. Retailability 100 percent owns Oclin Proprietary Limited, the company it is acquiring Edgars with, by a capacity of 3000 shares.
The target business, Edgars, offer textiles, cosmetics and cellular products. Edcon has a Motswana director, Charles Mzwandile Vikisi, a South African, Shane Van Niekerk and Zimbabwean Jethro Kamutsi.
“The Target Business comprises of two (2) Edgars franchise brands and private label stores across Botswana. These stores target middle to upper income customers and are home to a range of private label brands such as Free2BU, Charter Club and Stone Harbour, and a wide range of market label brands (such as Levi’s and Guess) for clothing, footwear and cosmetics.
In addition, the Target Business operates iconic Edgars Home and Edgars Beauty stores as store-in-store formats rounding out the department store offering in Botswana,” said CCA. Foshini also lines up to take Jet Botswana from Edcon.
The Foschini Group (TFG) released a statement confirming its latest intentions to acquire Edcon assets or Jet for a cash purchase consideration of R480 million. This was after the business rescue practitioners offered TFG to buy Jet by that amount.
CCA is currently mulling on a proposed merger by TFG to take over Jet operations in Botswana. Merger Notice No 21 of 2020 from TFG came a few days before the Retailability proposal. In this merger TFG, acting through Foschini Botswana, want to take over “parts” of the Jet business conducted by Edcon through Jet Supermarkets Botswana.
TFG will be willing to add Jet to its portfolio of 30 retail brands that trade in clothing, footwear, jewellery, sportswear, homeware, cell phones, and technology products from value to upper market segments throughout more than 4085 outlets in 32 countries on five continents. TFG will also get Jet’s distribution centre located in Durban and certain stores in Botswana, Lesotho, Namibia and Eswatini. Also part of this fat deal is that the company is looking to also acquire JET Club and all existing JET stock of no less than R800 million.
Johannesburg listed TGF owns Foschini Retail Group which owns the local operations called Foschini Botswana, the acquiring enterprise according to CCA merger notice. “TFG is not controlled by any enterprise/s and for completeness, the three largest shareholders of TFG holding shares greater than 5% as at 27th March 2020 are: Government Employees Pension Fund (16.2%) Public Investment Corporation (13.2%); Old Mutual Limited (6.7%); and Investec Asset Management (6.3%). The remaining issued share capital in TFG is widely held,” said the merger notice.
Only Abdool Rahim Khan is a Motswana in the Foschini Botswana directorship, the rest; Ganeswari Shani Naidoo, Anthony Edward Thunström and Gustav Jansen (alternate director) are South Africans.
According to the CCA merger, the Jet Business is Edcon’s discount department store division, selling clothing, footwear, homeware and some cosmetics as well as cellular products and targets lower-to-middle income consumers throughout Botswana. The Jet Business does not directly or indirectly control any enterprises, says the notice. CCA seeks any stakeholder views for or against the proposed merger, which may be sent within 10 days from date of this publication to the following address.
Botswana Communications Regulatory Authority BOCRA signed a memorandum of Agreement (MoA) with the Ministries of Transport and Communications (MTC), Basic Education (MoBE) as well as Local Government and Rural Development (MLGRD).
The MoA seeks to continue the collaboration that dates back to 2016 when the three parties first agreed to work together in a project aimed at computerizing and providing broadband Internet to primary schools in remote and underserved areas of Botswana.
The project benefitted 68 primary schools and 9 secondary schools through the construction of Local Area Network (LAN) in each primary school, provision of 5 Mbps dedicated broadband Internet to each Primary School and provision of Wi-Fi enabled tablets, laptops and related peripherals such as printers and copiers.
Further, the project will see the augmentation of computers in 9 Junior Secondary Schools with 30 laptops per identified school and employment of Information Technology (IT) officers at each primary school.
When speaking at the signing ceremony in Gaborone, Chief Executive of BOCRA and Chairperson of Universal Access and Service Fund (UASF) Board of Trustees Martin Mokgware said the project’s ultimate goal is to facilitate pupils in schools and host villages to be able to play a meaningful role in the digital economy.
Mokgware indicated that this necessitates upgrading of existing Telecommunications infrastructure to high capacity broadband that will support delivery of education, accessibility to the quality Internet and usage of ICTs.
The Fund began its inaugural programme by sponsoring the provision of WiFi hotspots in public areas around the country as its first project. Following the successful implementation of public WiFi hotspots, the Fund identified Kgalagadi, Ghanzi and Mabutsane areas for mobile network upgrades, schools computerization and internet provision.
Conscious that the project would not be possible without buy-in and support from MoBE, MTC and MLGRD, the Fund facilitated the signing of the first MoU between the three parties in 2016 for implementation of the project.
BOCRA Chief Executive said the signing of this agreement is aimed at benefitting the Kweneng District, adding that they have already assessed the area and have determined that they will be covering 62 underserved villages and 119 schools, 91 of which are primary schools.
“This is a project for which the partner Ministries need to re-commit for its success. Lessons from the previous schools’ computerization and internet connectivity project require that we increase our involvement and resources dedicated to the project for it to be successful. It is my belief as the project coordinator, that we will not do things the way we did them during the first project, for if we do, then we will not have learnt anything,” he said at the signing ceremony.
The purpose of learning is so that there can be continuous improvement to minimize the length of time and amount of resources utilized, he said expressing confidence that their partners will step up to the plate and ensure they play their part in the implementation of the project and that it will progress smoothly having already tread along a similar path.
UASF’s role lies mainly in funding and project management. According to Mokgware, once the project is completed, the work to integrate ICTs into the classroom begins in earnest. Therefore, he said, the project will not succeed without full cooperation and oversight of partners.
“MoBE will put in place the necessary content and ensure that the curriculum is available to all. MLGRD will provide, among others, the enabling environment by ensuring readiness of the school’s infrastructure and necessary security.”