CSC rescue thrown into chaos as Boustead Beef claims $3.5 billion

The corporate rescue of the Cold Storage Company was thrown into chaos yesterday when Boustead Beef, the company that entered into a US$130 million agreement with the government in 2019 to revive the ailing parastatal, filed a $3.5 billion claim as one of the creditors to the CSC shocking government officials that attended the meeting.

This came out at a creditors’ meeting in Bulawayo organised by the Master of the High Court and the Corporate Rescue Practitioner, BDO Zimbabwe, which was appointed by the High Court in December.

The Insider has, however, not been able to independently verify the Boustead Beef claim.

According to sources, Boustead Beef became the largest claimant after it filed claims totaling about $3.5 billion (about US$41.5 million at the current exchange rate) dwarfing all other creditors whose claims were reportedly below $200 million.

BDO Zimbabwe was also disqualified as the corporate rescuer, according to the sources.

A BDO representative who attended the meeting refused to comment referring all questions to Ngoni Kudenga who was appointed the corporate rescuer.

Mr Kudenga was not at his office when contacted for comment.

Sources said senior government officials who attended the meeting were shocked to learn about Boustead Beef’s claim as the officials believed Boustead Beef was a partner and not a creditor.

According to one of the workers who attended the meeting, the CSC rescue plan had been thrown back to step one.

The worker asked how Boustead Beef could claim $3.5 billion because if it had invested that kind of money into the CSC, the company would have been up and running.

According to its agreement with the government, Boustead Beef was supposed to invest US$45 million in its first year of operations but it failed to do so and instead it allegedly used rentals from CSC properties to pay workers before closing operations in September 2019 ostensibly to retool.

One of the mandates that were given to BDO Zimbabwe by the High Court was 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”.

(254 VIEWS)