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Gold Fields' 80m-rose Living Gold venture looking to R50m expansion with new partner
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2nd July 2008
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Gold Fields' four-year-old Living Gold venture near Carletonville, which has produced 80-million cut roses and exported 30-million of them abroad, is looking to taking on an additional partner and expanding, Gold Fields CEO Nick Holland tells Mining Weekly Online.

The 320-employee venture is an enterprise within Gold Fields' wholly owned Agrihold, headed by CEO Fred Formanek, and has trained more than 600 people in growing and exporting globally competitive roses.

The company needs R50-million to carry out its expansion plans and is seeking potential partners.

Gold Fields has already invested R100-million in the venture and in the coming year will invest another R10-million to R12-million, says Gold Fields VP commercial services Paddy Govender.

Holland says that there is potential for greater exportation of roses, which would have the benefit of offsetting the current higher fertiliser and coal costs.

"We need to expand the farm. It is currently on 10 ha and we need to expand that to 16 ha to try to leverage off the economies of scale of having a larger operation," Holland says.

"We are going to be doing that over the next year or two, subject only to finding another partner to invest with us," he says.

Currently Gold Fields holds 65% of Living Gold and the state-owned Industrial Development Corporation the remaining 35%.

"We can dilute our interest and the new partner could provide the necessary capital for expansion," he says.

On exiting, Gold Fields would invest the proceeds into other mining charter-type commitments.

Formanek says that the initial export target of Living Gold was on Dutch auction markets, but quickly moved to direct sales and is currently exporting to Japan, US and Sweden.

The business is looking to growing other varieties of flowers and introducing beneficiated flower products to maximise job creation.

Agrihold is also investing in bioprospecting and aquaculture besides floriculture, its investment portfolio focused on Gold Fields' Far West Rand and Free State operating areas as well as the labour-sourcing areas of the Eastern Cape, northern KwaZulu-Natal, Lesotho and Mozambique.

It has a trial export-focused bulb farm in Virginia and is exploring aloe opportunities given that South Africa hosts 140 aloe species.

Gold Fields established Agrihold as an investment holding company to focus on non-core enterprise development in agriculture.


Edited by: Creamer Media Reporter

 

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The CEO of Gold Fields’ company Agrihold, Fred Formanek, and Gold Fields CEO Nick Holland talk to Mining Weekly Online about Living Gold and the 30-million roses it has exported. Video cameraperson: Danie De Beer. Video editor: Darlene Creamer (02/07/08)
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