COVER STORY


and sugar blending. I also went into the edible oil business and the textile industry.” His first line of action was expanding the


capacity of the edible oil refineries he acquired. Dewji expanded MeTL’s edible oil refining capacity from 60 to 600 tons almost immediately. That underperforming edible oil refinery he acquired back in 2005 is now East Coast Oils and Fats, the dominant manufacturer of oils, soaps and fats in the country. The company controls a 60% market share, and accounts for more than 30% of METL’s annual revenue. Some of the world’s largest agricultural


companies have approached Dewji to acquire his business. Dewji says he’s not selling anytime soon. “There is so much opportunity for growth and


I’ll be shortchanging myself if I sell now,” he says. Dewji is also big on textiles. Tanzania’s former


socialist government had invested hundreds of millions of dollars in building textile mills. But again, the government could not manage these industries properly. Dewji bought them out, cheaply. “The machinery was all run-down and the


technology obsolete. But Tanzania is the third- largest cotton producer in Africa. There was a massive opportunity, so we spent millions of dollars in rehabilitating the mills by investing in top European and American machinery.” MeTL Group is now the largest textile


producer in sub-Saharan Africa with four textile mills (three in Tanzania and one in Mozambique) and an annual production of more than 100 million running metres of fabric. MeTL also operates its own cotton ginnery and also owns cotton plantations. The group competes favourably with China in


textile production. According to Dewji, textile production is cheaper in Tanzania than in China because labour is significantly cheaper in Tanzania and, where China has to import cotton, Tanzania produces its own in huge quantities. In a bid to help protect the industry, the previous Tanzanian government slapped import tariffs and a standard VAT of 18% to protect domestic manufacturers like MeTL. “China can’t compete with me,” he boasts. “Every year, we produce more than a hundred


million metres of cloth. For perspective, that is more than 2,500 times the circumference of the earth.”


18 CAMPDENFB.COM


China can’t compete with me. Every year, we produce more than a hundred million metres of cloth. For perspective, that is more than 2,500 times the circumference of the earth


A lot of bottle Apart from textiles and edible oils, another major


success story for the group is its beverage company, A-One Products & Bottlers. Dewji created A-One in the early 2000s by acquiring a number of government-owned bottling companies. He spent $48 million over time to turn the plant around. A-One’s bottling plant can now produce and fill as many as 24,000 beverage bottles per hour. The plant runs 22 hours a day and contributes more than $60 million to MeTL’s annual revenue. The subsidiary produces its own cola and orange drinks to compete with the Coca Colas of this world, and he produces a highly popular energy drink Bomba, considered a Red Bull competitor. Dewji’s business strategy is hinged on a quasi-leveraged


buyout model. He loves to hunt for rundown, loss-making businesses that have been badly managed. He then buys them for good value, restructures the company, and brings in fresh management, who in turn make it profitable. “I see a company that is on the brink of insolvency, and


the owner is struggling to stay afloat because he has got one product, very limited capital, and expensive debt. He does not have distribution and he has to give credit to customers because he’s small.


ISSUE 72 | 2018


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