THE first joint venture between Rainbow Tourism Group (RTG) and Swiss-based hospitality firm Grand Metropolitan Holdings BV (Grand) is set to launch in the second half of this year, according to information obtained by businessdigest.
This follows the strategic partnership agreement signed between the two companies in April at the World Travel Market Africa, paving the way for multiple joint ventures focused on technology and hospitality.
Grand has a balance sheet boasting assets exceeding €200 million (US$214,04 million).
“Once you sign an agreement, it’s a master agreement,” RTG chief executive officer Tendai Madziwanyika told businessdigest.
“What then happens is you now go into the detail of the various agreements that activate that master so that is what we have been busy on.
“We then work on actual activation plans to say what exactly we are going to be focusing on in Zimbabwe, in Africa, on the Gateway Stream, and in the hospitality school.
“All those now need proper real work where we now, really, have to get down to real work and beyond just strategic thinking and strategic visioning. We believe in the second half of this year, we will begin to start coming to market with tangible stuff.”
This is part of the group's capital expenditure exceeding US$4 million for the year, as it undertakes a "refashioning" exercise of its primary revenue generator, the Rainbow Towers Hotel and Harare International Conference Centre.
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“I can tell you that we will be looking at an excess of US$4 million this year alone. Next year, we will have to finalise that, but we are seeing ourselves growing year by year,” Madziwanyika said.
He said the group was excited about the partnership agreement with Grand.
“We signed what we call that partnership agreement around December and ever since what we have been able to do is to launch it in Cape Town (South Africa),” Madziwanyika noted.
“We launched it to the public, not only in Zimbabwe but also in Africa. Following that, we managed to form various companies to activate the strategic partnership agreement.”
He said the strategic partnership agreement was a series of joint ventures, not mergers.
“We formed a joint venture in Zimbabwe, we formed a joint venture to drive business in Africa, we formed a joint venture to drive the Gateway Stream, and we also formed a joint venture for the hotel school,” Madziwanyika said.
“So, we have formed a series of joint ventures that we aim to then use to activate the various opportunities that we included in the strategic partnership agreement.
“If you were to look in Zimbabwe, the joint venture agreement is that we would own 55% as RTG and they would own 45%.
“What it means is that if we find opportunities in Zimbabwe, we will jointly manage that and they will bring in their skill, brands, and sort of international standards that we can then incorporate into that particular hotel.
“So, we are basically going to put international brands on local properties, and we will own 55% of the profitability of that type of business.”
The two companies will also identify existing properties or properties that are being developed anew to get management contracts.
“So, we will get those and manage them under the sub-Saharan Africa JP (joint partnership) where we will own 25% and they will own 75% on the understanding of course they have a lot more international exposure, experience, and they are bringing in a pipeline of hotels outside of Zimbabwe,” Madziwanyika said.
He said improving the Gateway Stream to the preferred booking platform for Africa was part of the joint partnership with Grand.
The Gateway Stream is an online platform and application that offers hospitality and tourism services, which has grown to have over 400 partners across Africa. RTG’s e-commerce booking platforms contributed 18% of the revenue for five months to May 2024.
