Ivorian Mayor's Group Is Said to Win Latest Saf-Cacao Bid

(Bloomberg) -- The liquidator of Saf-Cacao, formerly one of Ivory Coast’s biggest cocoa exporters, accepted a new bid for the shipper from a company headed by the mayor of the second-largest city, according to two people familiar with the matter.

Liquidator Alain Guillemain approved Saf-Cacao’s sale to Societe Agricole du Cafe-Cacao in a deal worth 145 billion CFA francs ($250 million), said the people, who asked not to be identified because they’re not authorized to speak publicly about the matter. From this amount, 15 billion francs will be allocated for working capital and the remainder to the shipper’s lenders in installments over 10 years, said the people.

Societe Agricole has to pay the working-capital portion before the deal becomes final, they said.

The company entered a bid for Saf-Cacao after the previous favored bidder, Prime Group of Companies, failed to make an initial payment of 40 billion francs out of its offer of 170 billion francs. Societe Agricole is headed by Nicolas Djibo, the mayor of the central city of Bouake and a member of President Alassane Ouattara’s ruling Rally of Houphouetists for Democracy and Peace.

Djibo confirmed that he entered an offer for Saf-Cacao, but declined to elaborate when called for comment. Guillemain declined to comment when contacted by phone.

The demise of Saf-Cacao, which purchased the second-highest volume of cocoa from the world’s top producer two years ago, has ensnared domestic shippers and lenders as the exporter’s 150 billion francs in unpaid borrowings prompted banks to curtail finance. After cocoa reached a six-year high in July 2016, the company was one of several local shippers who bet on further gains and was then caught wrong-footed, defaulting on 15,000 metric tons of cocoa for the annual season through September last year.

An audit by KPMG showed 32 exporters defaulted on more than 220,000 tons of cocoa, more than a 10th of the record crop of about 2.1 million tons harvested in the same season.

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