- Expansion backed by the “Go-To-Africa” strategy
- Over P700m already invested in Kenya
- Lotlole aims to increase its portfolio outside Botswana from 6 percent to 45 percent
Backed by its newly launched strategy named “Go-To-Africa,” diversified real estate company, Letlole La Rona (LLR) aims to integrate its business into the African economy.
“We are a Botswana company that is firmly rooted in Botswana and as we grow, we are expanding and optimising our Botswana portfolio as well as diversifying geographically,” said the CEO of Letlole, Kamogelo Mowaneng, at the launch of the strategy in Gaborone recently.
“LLR has over the years provided its stakeholders with consistent, sustainable returns, and we intend to continue doing just that through value-enhancing real estate investments which unlock superior returns for our shareholders,” she said. Mowaneng noted that during the year, the company interrogated the strategy for relevance after the COVID-19 pandemic and regularisation of historical corporate governance challenges that it faced. “This resulted in the decision to develop a refined strategy that clarifies the strategic direction of LLR and seeks growth in the best interest of the company and its stakeholders,” she asserted.
The new strategy, the CEO explained, seeks to optimise and diversify the company’s portfolio, drive growth of the balance sheet, enhance stakeholder value and sustain investor returns. Mowaneng noted that investing in Africa may have its problems but Letlole is doing so fully aware of the risks. “We are aware of the risks of rolling out our ‘Go-To-Africa’ strategy and we intend to form strategic partnerships with credible entities who have regional experience,” she said.
“This approach is important as it guides the investment process to only consider extraordinary assets and simultaneously mitigate risk to a large extent, considering the counterparties alongside whom we are investing.” LLR’s “Go-to-Africa” strategy, Mowaneng asserted, has the potential to be significantly value-accretive to the company’s investors in line with LLR’s ethos of being the ‘Basket of Wealth’ for all Batswana.
“Considering the scale of potential pipeline transactions, it will further support improvement to the fundamentals of our portfolio, with an uplift in net asset value and much longer weighted average lease terms,” she said. LLR is the largest industrial asset owner in Botswana and houses a number of key tenants – from distribution centres and international car part manufacturers to diamond cutting and sorting companies. The company has already started the rollout of its refined Go-To-Africa strategy.
In July this year, LLR received shareholder approval to acquire an initial 30 percent equity stake in Orbit Africa Logistics in Nairobi, Kenya for US$7.2 million, with an option to increase this investment to 50 percent for a further US$ 7.6 million. After making the investment in Kenya, approximately 6 percent of the LLR portfolio is outside of Botswana. “We envisage growing this to approximately 45 percent over time,” Mowaneng said.