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CSC deal under scrutiny

by Staff reporter
27 Jan 2021 at 05:55hrs | Views
THE Government says the corporate rescue proceedings being implemented on the Cold Storage Company (CSC), among other issues seeks to examine Boustead Beef operations and capacity to revive operations at CSC.

In January 2019, the Government through the Ministry of Lands, Agriculture, Water and Rural Resettlement entered into a joint venture agreement with Boustead Beef, a United Kingdom investor who has committed to inject a minimum of US$130 million  over five years for the revival of operations at CSC.

Part of the arrangement was that the investor would use CSC assets and extinguish the parastatal's liabilities that run into millions of United States dollars. However, this has been delayed by a myriad of issues that have led to the placing of CSC under corporate rescue in December last year.

The order was granted by the High Court in Bulawayo under case number 1779/20. In a statement, the Ministry of Lands, Agriculture, Water and Rural Resettlement said the terms of reference of the corporate rescue plan shall among others be to:

"Examine Boustead Beef (Pvt) Ltd's current operations (investments made and operational initiatives implemented since the signing of the agreement) and establish whether or not it has capacity to revive CSC and advance the Livestock Growth Plan," reads part of the statement.

Mr Ngoni Kudenga of BDO Zimbabwe Chartered Accountants has been appointed the corporate rescue practitioner with the overall responsibility of ensuring CSC avoids liquidation.

Leading the corporate rescue proceedings, Mr Kudenga is mandated with the overall responsibility of avoiding liquidation of the parastatal while ensuring it remains in a solvent state for the benefit of the company's stakeholders, creditors including the company's workers.

"The objective is to avoid liquidation and bring CSC back to profitability and contribute to the Livestock Growth Plan and National Development Strategy," it said.

The corporate rescue plan was also investigating  previous CSC operations and is expected to expose the weaknesses within the firm's systems and recommend possible solutions.

In addition, the corporate rescue plan also looks at investigating CSC adherence to corporate governance principles and recommending aspects that require strengthening.

Lands, Agriculture, Water and Rural Resettlement Minister Dr Anxious Masuka is on recording expressing concern over the alleged rampant corruption and unlawful dissipation of assets by certain CSC executive members, board members, and Government officials.

Source - the herald