African Lakes

The African Lakes Corporation plc (ALC) is a British company which operated businesses in Africa. It is often referred to as just "African Lakes".

The company was originally established as the Livingstonia Central Africa Company in 1877-78, headquartered in Glasgow and managed by John Moir and Frederick Moir. Their focus was on trade and transportation opportunities, both to make a profit and to develop European influence in the area. They established trading posts at locations from Nyasaland down to the mouth of the Zambezi River and operated a number of steamboats on Lake Nyasa. It was renamed African Lakes Corporation in 1894. A rail link established in 1908 reduced the importance of the steamers; company focussed on its Mandala stores, and established an automotive business Mandala Motors in 1924, which grew to include 11 countries in Africa. It was later absorbed by the British South Africa Company, and operated general stores known as Mandala, but in 1982 was re-registered as The African Lakes Corporation plc.

During the 1980s and in order to utilise ACT paid on dividends to shareholders, the Company acquired several profitable motor delearships in the UK. During the recession in the mid 1990s the Company was forced to dispose its UK Motor Group as these were incurring losses the Company could not sustain. It then successfully raised new capital, bringing in new investors, to clear residual debt and expand its activities.

The Company was successful after this in raising additional capital and acquired further Automotive and IT distribution companies, disposed of its hotel group in Malawi and then acquired Africa Online, an Internet Service Provider based in Nairobi.

Thus the Company focused on three core activities, automotive, IT distribution and internet in sub-saharan Africa, but thereafter made the internet its focus. This proved to be a the Company's and its Management's undoing. Ultimately in order to sustain the cash required for its early-stage internet operations and its projected expansion the Company was forced, in the absence of new capital, to dispose any assets it could and raise money. The Company sold its non-internet businesses including the Vizara Rubber Estate in northern Malawi for what could be considered a fraction of its actual worth to a consortium of three including the then General Manager of the estate Dinesh K Chugh in March 2003, whereas in May 2002 the entire Malawi automotive interests Mandala Ltd (T/A Malital Ltd and Malawi Motors) were sold to the French Group CFAO SA (Formerly Compagnie Française de l'Afrique Occidentale, again it could be considered these were sold in "fire sale" environments in a bid to raise cash to fund the ailing internet business.

Sales of profitable investments and continued losses amd massive provisions against the investment in its internet business led to a significant losses, deteriorating balance sheet and share price. The Company had been listed since incorporation and had also listed shares on the Nairobi Stock Exchange, but following the collapse of its share price it was delisted in 2003 and became a private company. On cessation of its listing its share price was less than 1p; the lowest in its 120 year history. Thereafter Management restructured the balance sheet to wipe out a large number of shareholders.

Despite this, Management finally had to admit that which was so clear to others; their strategy was flawed and destructive and the receivers were called in.

The Company sold Africa Online to Telkom South Africa as its last asset in 2007 for a portion of its original gross investment and is now being liquidated after over 130 years of operation.

References

* Owen J. M. Kalinga and Cynthia A. Crosby, "Historical Dictionary of Malawi", 3rd ed. (Scarecrow Press, 2001) ISBN 0-8108-3481-2

External links

* [http://www.africanlakes.com/ African Lakes homepage]