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NIGEL Chanakira has been given up to August 5 to present a favourable proposal to secure a controlling stake in Kingdom Financial Holdings Limited (KFHL) seen as the shortest route to end the financial institution’s troubled marriage with Meikles.
This deadline shows growing impatience in the Meikles Limited family over failure by Chanakira to amicably end the marriage.
Meikles Limited will hold an extraordinary general meeting on August 6 where it will deliberate Chanakira’s anticipated proposal which, if it satisfies the meeting, would allow the businessmen to take over KFHL.
If the proposal does not meet the expectations of Meikles, a de-merger would take place, Farai Rwodzi, Meikles board chairman told an annual general meeting on Friday.
“We are going to requisition an EGM on the 6th of August and before now and the 6th the shareholders will give Nigel (Chanakira) and Kingdom time to come up with a firm proposal on whether they are interested in buying 100% of the bank,” he said.
“If the proposal is good enough we will table it before shareholders in the requisition for an EGM on the 6th of August.
“If it’s not, we will then requisition for a de-merger of the business on the 6th of August as we had previously undertaken to do.”
Rwodzi said they had made some substantial progress in dealing with all the regulatory authorities to ensure that all the outstanding matters involving US$22,5 million were resolved.
Meikles lodged US$22,5 million with the central bank to meet the minimum capital requirements of KFHL’s subsidiaries and the money has to be repaid.
Insiders said if the central bank does not have the money, Meikles would most likely settle for tax credits from the Ministry of Finance.
The ministry has already said that government would take over the debts of the central bank.
Information obtained last week shows that the deal proposed by Meikles is valued under US$15 million though it was unclear whether Chanakira would be able to fulfill his side of the bargain.
Chanakira’s spokesperson said on Friday “they have not yet been formally advised of the outcome of the Meikles shareholders’ meeting therefore it would be presumptuous to comment at this stage”.
“However, issues related to the de-merger are being dealt with in consultation with the relevant regulatory authorities, who, together with all parties, are focused on coming up with a lasting win-win solution. The parameters of the solution, though still consultative, have reached an advanced stage.”
Insiders said the deal is the best option available unlike the previous deal that had been negotiated by the parties.
Initially, the parties had agreed to de-merge with Cha-nakira swapping his 6% shareholding in Meikles for John Moxon’s 18% stake in KFHL giving Chanakira 24% in KFHL.
Moxon had agreed to sell his remaining 25% to Chanakira for US$11 million paid over two years on condition that Moxon was despecified.
Moxon was despecified in May.
KFHL merged with Meikles, Tanganda and Cotton Printers in 2007 to form Kingdom Meikles Limited, then one of the largest capitalised companies listed on the Zimbabwe Stock Exchange.
However, irreconcilable differences between founding chairman Moxon and chief executive officer Chanakira led to the proposed end of the marriage after months of acrimonious squabbling in both the private and public spheres.
In May, Brendan Beaumont, Meikles group chief executive officer told an analysts briefing that conditions precedent to the de-merger have not been met and the board had made every effort to effect the de-merger and agreement had lapsed on April 21.
The board was tasked by shareholders to find the way out of the logjam and was supposed to report on or before May 31.
No solution was found paving the way for the latest attempt.
BY OUR STAFF
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