HomeLocalNestlé Threatened Over Cancelled Milk Deal

Nestlé Threatened Over Cancelled Milk Deal

NESTLÉ Zimbabwe has in the past fortnight received threats from various quarters, among them Zanu PF youths and government officials, after it stopped buying milk from First Lady Grace Mugabe’s Gushungo Holdings.

The threats came amid revelations that Nestle had no direct contract to buy milk from Mugabe’s farm.
This comes a week after the Reserve Bank temporarily froze the firm’s bank accounts and ordered forensic audits.

The freeze was lifted last Friday but the central bank did not disclose to Nestlé what it wanted to probe.

Sources at Nestlé told the Zimbabwe Independent that on Friday the police visited the firm’s factory where they asked a number of questions before they left without explaining what they wanted the information for.

“It is true that police officers visited the factory and asked the members of staff about the operations of the company,” one of the sources said. “They made enquiries about the directorship of the company and other general questions before they left. What is worrying is why they chose to visit the factory and not the head office which is in the central business district.”

Apart from the police, the sources said, the firm received telephone calls from Zanu PF youths threatening to take over the company.

“We have also been receiving a number of threats from some interested parties and some are even saying they would come here (to the head office) and deal with us,” the source said. “This is not something we are taking seriously mainly because we have realised that these are people who are getting angry on behalf of someone else.”

Information gathered by the Independent has shown that the supply of milk to Nestlé by Gushungo Holdings was through a third party contract earlier this year and it was not meant to be a permanent arrangement.

Gushungo Holdings was not at first directly contracted to Nestlé as it supplied its milk to Dairibord before it abandoned the company after it failed to pay for deliveries on time.

Eight other milk suppliers were affected by the decision to stop accepting milk from Grace’s farm.
Gushungo Holdings together with the other affected farmers were under the category of non-contract farmers on Nestlé’s list of milk suppliers.

Nestle has seven permanent milk suppliers.

Nestle won the 2009 Confederation of Zimbabwe Industries exporter of the year award and it is a wholly owned subsidiary of Nestlé which is headquartered in Switzerland.

The Swiss Confederation on behalf of the milk processing company entered into a bilateral agreement with the government of Zimbabwe signed 13 years ago.

The milk processing company was put under international pressure to stop accepting milk from the First Lady’s farm.

Last week’s freezing of Nestlé’s bank accounts sent negative signals to potential investors.

This has been compounded by the withdrawal by Shoprite from a R167 million proposed deal which would have seen the South African retail giant buying a significant stake in OK Zimbabwe.


Leonard Makombe

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