HomeLocalSo which of the two is lying?

So which of the two is lying?

SM: You have been administrator of SMM for some time now, what have you achieved since you took over?


Gwaradzimba: I have not taken over SMM, I must make that clear. I am just like a manager. The only difference is that I have taken over the role of the board of directors so that I direc

t management the way that I see fit. The control of the assets and business is under me.


SM: What was really the problem with SMM? Why did it need an administrator in the first place?


Gwaradzimba: The problem was that it was technically insolvent. This resulted from Mr Mawere’s abuse of the dispensation that the government had given to him or to SMM that he (Mawere) controlled. He abused the export exemption. SMM had a dispensation that they could market their own produce. Mawere had formed the Southern Asbestos Sales (SAS), which was selling the fibre and collecting the money but not remitting it.


SM: So how did the government and you come into the picture?


Gwaradzimba: SMM management first got productive sector funding of $28 billion. But PSF was a prerogative of the banks so when that money was finished SMM went back to the banks and requested more. But the banks became suspicious, they were told that they would not get any more funds unless they service the other debt.


SM: Your explanation pertains to Shabani Mashava Mine. How do you justify being administrator of the whole SMM group plus associate companies like Zimre? What has the trouble at the mine have to do with listed firms like Turnall, Steelnet and General Beltings, which you now administer?


Gwaradzimba: SMM operated as a group and all facilities were secured through the group. They were secured under SMM guarantees. Turnall would borrow under SMM guarantees and every other company in the group would do the same. That guarantee became useless because of the financial crisis.


SM: Was the government invited to help or it just decided to make it their business to come into the company?


Gwaradzimba: It was not government that approached SMM with help. It’s SMM management who approached government and pleaded for help after failing to get facilities from bank. They told the government that they were in trouble and could close.


SM: Mawere argues that his companies were viable.


Gwaradzimba: The companies are capable of being viable, that’s how I would put it but if mismanaged they can go under. The only reason why government is interested is that they know that if properly run, the company is be viable.


SM: I just talked to him (Mawere) 30 minutes ago about the same issue and he repeated that statement. Is he telling the truth?


Gwaradzimba: That is not true. The situation was desperate.


SM: So is Mawere misleading the public? Is he lying?


Gwaradzimba: He is lying of course. If you take out what is in the company, there is no way that they can be viable.


SM: How were you appointed?


Gwaradzimba: I don’t know how I was appointed because appointment comes first and notification comes second. Minister (Patrick) Chinamasa called me one early morning on the 6th of September (last year). He said I was required at his office urgently. I got there and found all the chief executives and finance directors of all the group companies and that’s when I knew that I had been appointed.


SM: Why do you think you were appointed out of all accounting firms in Zimbabwe?


Gwaradzimba: I don’t know but just like I am appointed everyday as an auditor of companies.


SM: It’s a year since you were appointed, what is the situation now at SMM?


Gwaradzimba: I would say things are okay. They were not maintaining the machinery and the mine was producing about 8 000 tonnes. That is because Mawere was not returning the money; he was keeping it in SA.


SM: So Mawere was asset stripping?


Gwaradzimba: I don’t want to use those words but from what I can see that is what it amounts to.


SM: Mawere was suffocating his own companies?


Gwaradzimba: Yes.


SM: There are obviously some companies that are going to be liquidated.


Gwaradzimba: We have applied for the liquidation of Peter Transport and Logistics because it was bankrupt. There is Viamax Logistics PVT.


SM: Which ones have been disposed of?


Gwaradzimba: They are CR Woods and Images, Best Practices, Regatta Financial Advisory Services, FSI Trading, Midsec and Fortress Travel and Tours.


SM: What remains of the group?


Gwaradzimba: SMM Holdings with its mines, its subsidiaries Turnal Holding, Steelnet, General Beltings, Sino Chemicals. Then there is its associate, CFI Holdings.


SM: Can I take you back to your appointment. Did you say you don’t know how you were appointed, is that what you said?


Gwaradzimba: Maybe I don’t understand the question, what do you mean how was I appointed? I take it that you mean the process used.


SM: The question is clear? How were you appointed, because many questions have been raised about that?


Gwaradzimba: Yes, I was just called to say that the government had appointed me.


SM: Prior to that did you have any dealings with Minister Chinamasa or any other minister?


Gwaradzimba: No, I never, not one of them did I work with in any capacity before my appointment. The only work I have done with any people in politics was during the war.


SM: Your payment is of major concern to the public.


Gwaradzimba: Why would it concern anybody?


SM: Because there are public companies under you and it’s of public interest. Beside this was a distressed company. People would want to find out how much you got out of it.


Gwaradzimba: The payment in the case of corporate recovery work is dealt with in the Companies Act and the Act has been there for ages.


SM: That is understood but just explain how you are paid. Is it per turnover basis or what?


Gwaradzimba: It’s on turnover, assets recovered, asset taken under control and so there are various ways of calculating the amount that has to be paid.


SM: There are claims that you have received more than $80 billion. Is that figure correct?


Gwaradzimba: That figure is commensurate with the work that I do.


SM: Even if it’s $80 billion?


Gwaradzimba: Yes, it’s commensurate even if it’s $80 billion because the magnitude of the work undertaken is tremendous. I would say it’s overwhelming.


SM: Government has taken over SMM, is that true?


Gwaradzimba: Government hasn’t taken over but it will when is turns its a debt into equity once this has been approved. SMM owes government $700 billion.


SM: How much did you pay for the company?


Gwaradzimba: We got it for US$2 million.


SM: Was there an independent evaluator?


Gwaradzimba: No, that is up to the seller. I negotiated and they were free to say whatever price.


SM: You have interest in SMM through your Global Nominees?


Gwaradzimba: No, Global Nominees is only holding shares on behalf of the government. It is only a nominee company. I have no interest in this company.


SM: Did they not have the alternative of selling the company to an outsider? Was the government the only ready buyer around?


Gwaradzimba: What was expedient was to have someone who was interested and had the resources. I think government was the only option.


SM: The SMM administrator (Afaras) Gwaradzimba says you destroyed your own company by externalising forex, is that true?


Mawere: It’s rubbish. How can I destroy my own companies? How is that possible? Those companies were profitable and it is government through Gwaradzimba who expropriated them.


SM: He says you were not remitting foreign currency back into SMM, leading to its collapse. He also claims that you were asset-stripping through your company, Southern Asbestos Sales (SAS) and that you abused a government dispensation.


Mawere: It is Gwaradzimba who is stripping the assets of my companies by paying himself billions when he is supposed to resuscitate them as he says. How can I destroy my own companies? His claims that I was bleeding my own companies by asset-stripping them are criminal, defamatory and untrue. SAS is not a Zimbabwean company, it’s an issue being dealt with in South Africa. How does the SAS’s actions become of interest to Zimbabwe when it’s a South African company?


SM: But Mawere, are you admitting that the companies were in trouble when they were taken over by government last year?


Mawere: No, they were not in trouble. If my companies were in trouble, why is he (Gwaradzimba) taking billions in fees? Why did the government take them over? In any case, he should tell the people whether Zimbabwe can sustain a viable business. Zimbabwe is a failed state where businesses cannot be sustainable. I am saying Gwaradzimba is an agent of the government’s broader scheme to take over my companies.


SM: Are you being targeted, if so, why do you think so?


Mawere: It’s not me alone who has lost his companies. I’m not the only victim of this government’s criminal activities. I’m only one of the victims of the government’s acts of thieving. It is part of government’s criminal activities, of taking over personal property in the name of national interest. Look at what they did to banks and many other companies. What happened to the farms? It’s government policy to stifle investment.


SM: So you are saying there is a government plan to expropriate private companies?


Mawere: That is what the trend shows. For instance, why was it necessary for the president to issue a special decree for my companies? So yes, there is a plan to take over private companies. The case of the banks and the thousands of farms is a clear indication of that. And in my case, Gwaradzimba is an agent of that government scheme.


SM: Who in particular has hatched this plan against you? I mean, who planned the take-over, and for what purposes?


Mawere: It is the government.


SM: Government is a broad entity Mr Mawere. Who in government masterminded this move against you and your companies?


Mawere: It is the Tsholotsho guys. Those ministers in the Tsholotsho issue took my companies to fund their meetings and plan. I am reliably informed. Those ministers like (Patrick) Chinamasa, July Moyo and (Jonathan) Moyo are the ones who were in the forefront of taking my companies. Gwaradzimba is part of that plan. I have information that some minister in government is on the payroll of my companies.


SM: But do you have evidence to prove that allegation Mr. Mawere?


Mawere: I don’t but that is what I have been told by inside people.


SM: Okay, but Gwaradzimba says that it is not government that approached SMM with a package to help. He said it was the SMM’s management that approached government for help after they realised that the company was collapsing because of your actions.


Mawere: Ah, who are they to go to the government for assistance without permission from the shareholders? How could they have done that when I the owner was there?


How do they ask for money from someone when the owners are there? He should tell you who in the management went to that meeting with the government. Where has it ever happened that if there is no food in my house the maid goes out and invites an outsider into the house to help when the owner of the house is there? That is not possible. To me Gwaradzimba is an intruder in my affairs.


SM: What should have been done?


Mawere: The law is clear on how to deal with insolvent companies. If my companies were insolvent, they did not need a presidential decree to deal with the problem because the laws on troubled companies are clear. Under the Constitution section 89 it is the court that determines the insolvency of a company, not the creditor.


Gwaradzimba should know that as an accountant — that is if he is an accountant at all. I created those assets and sustained them. A person who reaps where he never sowed is a robber and Gwaradzimba to me fits that description. He is getting $80 billion for knowing the right people and therefore he is the asset stripper, not me.


SM: Earlier you raised concern about Mr Gwaradzimba’s appointment.


Mawere: I said there is everything wrong with that appointment. Gwaradzimba was appointed on the 14th of September yet on the 6th of September he had already dismissed the board of directors. His letter of appointment says he was appointed in his individual capacity yet Chinamasa told parliament he had appointed his company, AMG Global Chartered Accountants.

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