Chartered accountant, Ngoni Kudenga, of BDO Zimbabwe Chartered Accountants has finally started work on the corporate rescue of Zimbabwe’s largest meat processor, the Cold Storage Company.
Kudenga was granted the order to take over the ailing parastatal in December but was not able to do so due to the national coronavirus lockdown. He only collected the order last week.
Waters had, however, already been muddied in the three-month impasse with reports that a union called the United Food and Allied Workers Union of Zimbabwe was challenging the appointment of Kudenga.
Workers at the CSC said the union did not represent them as they represented themselves the same way workers at the National Railways of Zimbabwe and the Zimbabwe Electricity Supply Authority did.
UFAWUZ, however, insisted that it had the mandate of the workers.
Kudenga was asked to rescue the CSC after a company claiming to be a British investor, Boustead Beef, failed to revive the company after entering into a US$130 million investment agreement with the government in January2019.
According to the order granted to Kudenga by the High Court, his company is supposed to:
- to investigate the company’s affairs, business and property and financial situation in terms of Section 134 of the Insolvency Act;
- investigate previous CSC operations and expose the weaknesses within the systems and recommend possible solutions;
- investigate adherence to corporate governance principles and recommend aspects that require strengthening;
- confirm the number and status of the properties and ascertain the status of all CSC assets;
- investigate claims of asset stripping or any other activities and institute measures to stop the asset stripping immediately;
- examine the Scheme of Arrangement and recommend appropriate measures;
- investigate the employment and dismissal of employees from the date the Joint Venture was signed;
- examine and recommend Pension benefits due to the employees;
- 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.
One of the first tasks for Kudenga is to meet CSC creditors including workers.
Boustead Beef, however, seems be worried about the investigation into its operations since signing the agreement with the government as it has been blaming workers for its failure to revive the company.
Workers have accused the company of stripping its assets when it took over.