… for the acquisition of Buddhavarapu Farms SA – Published on Food Crisis and the Global Land Grab, August 7, 2012.
CONAKRY, REPUBLIC OF GUINEA (PRWEB): On July 30, 2012, Farm Lands of Africa Inc. (OTC Markets: “FLAF” or the “Company”) entered into a share exchange agreement with Buddhavarapu Farms SA (BFS) and BFS shareholders whereby upon the closing under the agreement the Company will acquire 100% of the equity capital of BFS in exchange for the issuance to BFS shareholders of 18,416,670 shares of the Company’s common stock, representing 66.66% of the Company’s outstanding shares on a post-closing basis.
BFS is a Republic of Guinea agricultural production company with a strong presence in West Africa and its roots in India.
BFS has a land bank of 220,000 hectares under a Protocol d’Accord from the government of the Republic of Guinea, which converts into leases from the community owners for periods of 50 years. While primarily focused on rice, the current season’s campaign also provides for programs to process palm oil and establish eucalyptus plantations. BFS has already completed a season of experimental vegetable production headed by Mr. VCN Reddy. It has commenced rice cultivation and commercial seed production headed by Dr. Gowri Shankar.
Prior to starting the BFS eucalyptus plantation program, a one million-plant nursery has to be established; the program is due to start immediately, drawing on the experience of a strong team led by BFS director Mr. J.S. Rao, formerly an executive with the Indian multinational corporation ITC. A buy-back agreement for eucalyptus has been signed with ITC. The eucalyptus plantation will have maize as an intercrop.
The intended FLAF-BFS agro/forestry model will maintain cash flow during the four year period that is required before the eucalyptus can be cropped. At the same time the maize will address local food shortages in Guinea. BFS is acquiring the crop rights of a Guinean palm oil plantation aged between 6-10 years, together with its allied processing unit, all adjacent to the port of Conakry. FLAF’s intention is to export the products.
The first rice cultivation, which starts this year, is experimental. Eight separate seed varieties have been imported from India to determine which is optimal for coastal Guinea. The experimental beds extend to 400 hectares. Commercial seed production will follow immediately once the experimentation results are available. The rice program is also being managed by VCN Reddy.
The founders of BFS are farmers in Andhra Pradesh, the rice bowl of India where their families have farmed for hundreds of years. Mr. S.N. Kumar Buddhavarapu, who is among those joining FLAF’s Board, has developed comprehensive expertise in adding value to agricultural products. He has a strong sense of community and has established a charitable trust in India which provides meals for 25,000 children daily from the produce of his farms.
Farm Lands of Africa, Inc. and Buddhavarapu Farms SA share a commitment to agriculture against the backdrop of the renaissance of the newly democratic Guinea. Their agricultural models differ widely in that FLAF’s is highly mechanised, while BFS’s is traditional human labor. They are similar in that they both pursue the efficiencies of modern seed varieties and fertilizer. Together they can make a real difference to the food security of Guinea … (full text).