BGDO TREE

INVESTMENT
ANALYSIS
INVESTMENT TEAM
26TH DECEMBER 2015
OUTLINE
1. Background;
2. Investment Appraisal – Pine;
3. Investment Appraisal – Eucalyptus;
4. Outsourced Service Provider – Soko Africa Limited;
5. Way forward.
 1. Background
• SYNERGY PARTNERS LTD is a real estate development company headquartered at Birungi Estate, off Kira -
Kasangati road.
• Their business niche is affordable real estate investment solutions to individuals & companies.
• They are steadily become one of the leading land developers in Uganda, with world class housing communities
established and managed in Kira (Birungi Estate), Gayaza (Naava & Sanyu Estates), and Matugga (Malaika Estate) –
ongoing. Our competitive advantage is passion, integrity, and hard work.
• Synergy has acquired 340 acres of land in Nakitoma Nakasongola district;
• The land has been gazetted for a forestry project named Amaya Tree Estate [Phase 1];
• More adjacent land will be acquired and developed thereafter, totaling 8 square miles. Amaya provides an opportunity
to invest in Uganda’s first organised tree estate community;
• An individual or company will be able to not only own land but enjoy professional commercial tree establishment and
maintenance services at a minimal fee;
• The back bone of the project is environmental conservation, as well as economic development through creation of an
additional long- term investment option.
1. Background Cont’d
• According to research, pine and eucalyptus have been noted as the most feasible commercial trees to
grow in Uganda. Pine takes between 15 – 18 years to mature while eucalyptus takes between 7 - 10
years. Based on projections, with appropriate tree establishment and maintenance, investors should
expect an eventual annualized return on investment of 8 to 14%.
• Beyond margins is social responsibility. It is prudent that individuals and companies that can afford
should invest in forestry so as to abate the aforementioned deforestation crisis. Through Amaya Tree
Estate, we can be the positive change we desire.
• The Estate will feature a community area complete with rental accommodation & dining services, fresh
water, clean toilets, and business area to support our clients during their visit to the Estate, or the nearby
tourist site – Ziwa Rhino Sanctuary.
 1. Background Cont’d
Outsourced Service Provider (OSP) – Soko Africa Limited;
• Soko is a registered company in Uganda and has established itself as one of the
most respected providers of professional-level agro-forestry services;
• Soko Africa Ltd. (Soko) has a wealth of experience in the areas of agro-forestry
services and has worked in various districts in Uganda and other African countries;
• Soko’s mission is to promote the environment and the health and well being of
African people through a range of agro-forestry services;
• Soko Africa’s clients range from multinationals to individuals whose service
requirements include consultancy services in conducting assessments, field
research, bush clearing, land preparation, slashing, spraying, planting, pruning,
etc.
 1. Background Cont’d
OSP - Soko Africa Limited (Company Experience);
CLIENT
Kayunga Sugar Factory
Kakira Sugar Works
Greenhill Farm
Sawlog Production Grant Scheme (SPGS)
Clients
National Forestry Authority (NFA)
Eng. Ephraim Kisembo
Busitema Agricultural College of
Mechanisation
Individual farmers with block farms
Cotton development for Cotton
Development Organisation, NARO
Coffee plantation for LCV Chairman
Kinyara Sugarcane Outgrowers Ltd.
PERIOD DESCRIPTION OF WORK
2010 - present  Sugarcane establishment in Kayunga District (5,000 hectares) under Madhivani Group of
  Companies.
2005-present  Established Musoli Forest Reserve;
 Sugarcane establishment in Nanfumba, Mukono District;
 Established forests in Mayunge to the tune of 1,200 hectares;
 Maintaining the same area for three years after establishment
 Offering other agriculture based consulting services Mayuge and Kayunga districts 
2013-2015  Bush clearing in Mubende
 Cattle farm establishment in Mubende
 Providing advice for the general running of the farm
2008-2013  Maintenance in Lwamata Forest Plantation; and
   Offering forestry consulting services to several clients in Kiboga and Masindi Districts 
2006-2012  Weed control Kityerera Forest Reserve in Mayuge District;
   Maintenance Magamaga Forest Reserve in Iganga District; and
 NFA Forest Reserves in Kiboga District 
2004-2008  Established 400 hectares of pine trees under SPGS supervision in Masindi District
2004  Establishment of 466 acres of cotton plantation using minimum tillage in Busia district
2004  Maize plantation establishments using minimum tillage for block farms in Masindi and Luweero 
2003  Establishment of cotton plantations using minimum tillage, as well as weed and pest control or a
block of 500 acres of cotton in Masindi district 
2002-2004  Coffee plantation establishment and weed control using chemicals in Masindi district. 
2002-2003  Tractor interow cultivation in sugarcane plantations. 
 1. Background Cont’d
OSP - Soko Africa Limited (Company Staffing);
# Staff Name
1 Mr. Roger Rwampwanyi
2 Mr. Henry Lawrence Taabu
3 Mrs. Memory Bandera-
Rwampwanyi
4 Mr. Ronald Balinda
5 Firefighting and first aid
teams
6 Supervisors and casual
workers
Position
Managing Director 18 years experience working with national and multi-national companies on
various agro-forestry projects. Worked in Tanzania and Zimbabwe. Forester
by profession. With Soko since inception
General Manager Charged with running the day-to-day activities at Soko. He is an agronomist
and brings a wealth of over 20 years’ experience in agriculture based
projects.
Operations Director In charge of the smooth running of operations at Soko. She has worked in
various capacities and has enormous experiences working with companies
and organizations in the US, West, East and Southern Africa.
Administrator Works hand-in-hand with the accountant and General Manager. He ensures
the timely disbursement of funds to carry out projects and provides the
necessary financial accounting of the project.
Support staff Soko has a team of trained fire fighters and first aid responders on site.
Support staff 220 casual workers and 20 well trained supervisors having received on the
job training over the years from experts from Serere Research Centre,
Monsantos, Balton, Kinyara Sugar works and Kakira Sugar Works.
 1. Background Cont’d
OSP - Soko Africa Limited (Company Equipment);
# Item Quantity
1 Caterpillars Two (2)
2 Lorry One (1)
3 Staff Cars Two (2)
1. Background Cont’d
Site Visits and Preliminary Findings
1. Background Cont’d
Site Visits and Preliminary Findings
Physical site inspection/visit conducted by Joe Nuwamanya on 15 th December
2015 and the following noted:
• Trees haven’t yet been planted but a 5 acre plot was being prepared for planting;
• Location is 4.5kms off the main road;
• Approximately 150kms from Kampala;
• Titles are not ready but mother title is available, subdivision is done upon
payment;
• Choice of trees is up to the customer, Pine or Eucalyptus;
• Documentation provided and available.
 2. Investment Appraisal – Pine
Item Description Qty Unit Cost Total Providers Comments
A Initial Outlay Purchase of land 5 2,500,000 12,500,000 AMAYA tree estate (Synergy Partners)

B Est. Costs Initial Establishment Costs Soko Africa Ltd

Phase 1A Bush clearing 2 480,000 960,000
1,300 seedlings @ 600shs
Cost of Seedlings 2 780,000 1,560,000 each
Transport of seddlings from Namanve 2 156,000 312,000
Lining out, pitting and planting 2 210,000 420,000
First spot weeding 2 60,000 120,000 Per hectare
Second spot weeding 2 60,000 120,000 Per hectare
3,492,000

Phase 1B Maintenance for 33 months -

Vermin, pest control and general tree growth observation 2 70,000 140,000
Spot Weeding 2 900,000 1,800,000
Slashing 2 900,000 1,800,000
Fire line maintenance 2 330,000 660,000
Hoeing 2 330,000 660,000
Security/Tree guarding/Fire protection 2 165,000 330,000

5,390,000

Phase 1 total 8,882,000

Admin costs
20% 1,776,400
Contract for 3 years, 40%
Total Establishment and maintenance costs 1-3 years 10,658,400 4,263,360 down payment
Total Land and Establishment and maintenance costs 1-3 years 23,158,400
 2. Investment Appraisal – Pine Cont’d
Item Description Qty Unit Cost Total Provider Comments
Subsequent costs yr 3-8 - Soko Africa Ltd
Slashing 2 900,000 1,800,000 Three times a year for 5 years @ 60k each
Pruning 2 450,000 900,000
Fire line slashing 2 600,000 1,200,000
Fire line hoeing 2 300,000 600,000
Security/tree guarding/fire protection 2 165,000 330,000
4,830,000
Admin costs 20% 966,000

5,796,000 2,318,400 Contract for 5 years, 40% down payment

-
- Earnings from thinning to cover maintenance
Phase 3 Prunning costs
-
Thinning

Includes total costs of land acquisition, establishment and

GRAND TOTAL maintenance for 8 years 28,954,400
Sales Revenue from sales 2,400 200,000 480,000,000 Assuming no growth in cost per tree
Profit/Gains 451,045,600 4,698,392 Monthly earning

RFR Investment 15 5,570,900 83,563,500 870,453 Monthly earning

 2. Investment Appraisal – Pine Cont’d
Important Notes and decisions - Pine
# Item Cost Comments
1 Total Investment Cost 28,954,400 Land, Phase1 an Phase 2
2 Immediate requirement 16,763,360 Land plus 40% for First 3 year Contract
3 Contract with Soko Africa Limited TBD Engage Lawyer to handle transaction

4 Contract with Synergy Partners TBD Engage Lawyer to handle transaction

2. Investment Appraisal – Pine Cont’d
Workplan - Pine
 Item
3. Investment Appraisal – Eucalyptus
Description Qty Unit Cost Total Parties involved/responsible Comments
A Initial Outlay Purchase of land 5 2,500,000 12,500,000 AMAYA tree estate (Synergy Partners)

B Establishment Initial Costs - Soko Africa Ltd

Phase 1A Bush clearing 2 480,000 960,000
Cost of Seedlings 2 1,280,000 2,560,000 1,600 seedlings @ 800shs each
Transport of seddlings from Namanve 2 192,000 384,000
Lining out, pitting and planting 2 402,000 804,000
First termite Control 2 75,000 150,000
First spot weeding 2 96,000 192,000 Per hectare
Second spot weeding 2 96,000 192,000 Per hectare
5,242,000

Phase 1B Maintenance for 33 months -

Vermin, pest control and general tree growth
observation 2 70,000 140,000
Spot Weeding 2 1,440,000 2,880,000
Slashing 2 1,440,000 2,880,000
Termite Control 2 360,000 720,000
Fire line maintenance 2 528,000 1,056,000
Hoeing 2 528,000 1,056,000
Security/Tree guarding/Fire protection 2 165,000 330,000
9,062,000

Phase 1 total 14,304,000

Admin costs 20% 2,860,800
Contract for 3 years, 40% down
Total Establishment and maintenance costs 1-3 years 17,164,800 6,865,920 payment
Land and Establishment and maintenance costs
Total 1-3 years 29,664,800
3. Investment Appraisal – Eucalyptus Cont’d
Item Description Qty Unit Cost Total Service Providers Comments

Subsequent costs yr 3-7 - Soko Africa Ltd

Three times a year for 4 years @ 120k

Slashing 2 1,440,000 2,880,000 each

Pruning 2 480,000 960,000

Fire line slashing 2 384,000 768,000

Security/tree guarding/fire protection 2 165,000 330,000

4,938,000

Admin costs 20% 987,600

5,925,600 2,370,240 Contract for 4 years, 40% down payment

Includes total costs of land acquisition, establishment and

GRAND TOTAL maintenance for 8 years 35,590,400

Sales Revenue from sales 3,000 100,000 300,000,000 Assuming no growth in cost per tree

Profit/Gains 264,409,600 2,754,267 (Monthly)

RFR Investment 8 7,455,000 59,640,000 621,250 (Monthly

3. Investment Appraisal – Eucalyptus Cont’d
Important Notes and decisions – Eucalyptus
# Item Cost Comments
1 Total Investment Cost 35,590,400 Land, Phase1 an Phase 2
2 Immediate requirement 19,365,920 Land plus 40% for First 3 year Contract
3 Contract with Soko Africa Limited TBD Engage Lawyer to handle transaction

4 Contract with Synergy Partners TBD Engage Lawyer to handle transaction

3. Investment Appraisal – Eucalyptus Cont’d
Workplan - Eucalyptus
 4. Way forward
# Actions Responsibility Timeline for Completion
1 Obtain comments and input from Members All Members 26th December 2015

2 Decision on Investment alternatives All Members 26th December 2015

3 Decision on Legal Firm(s) to handle additional due All Members 26th December 2015
diligence, contracting and title transfer work.

4 Deadline for receipt of Quotation(s) Select firm rep 28th December 2015

5 Finalization of Evaluation and selection of legal Investment Team 30th December 2015
provider
6 Signing of Contract with Synergy and Soko Ltd and Chairman to advise TBD
settlement
7 Decision to commit funds to first project All Members 26th December 2015
Thank You