HomeNewsCSC’s British investor has net value of £4

CSC’s British investor has net value of £4

BY GARIKAI MAFIRAKUREVA

A BRITISH company, Boustead Beef, which had pledged to inject  US$130 million towards resuscitating the Cold Storage Company (CSC) has a net value of £4, it has emerged.

CSC, which has been facing viability problems, has been looking for investors to jumpstart its fortunes following several years of plunder and asset stripping.

Ngoni Kudenga of BDO Zimbabwe Chartered Accountants was last year appointed the interim corporate rescue practitioner by Lands minister Anxious Masuka to implement the rescue plan.

Boustead Beef was supposed to raise and invest a minimum of US$130 million into CSC over five years, for both capital expenditure and working capital for the business; as well as to pay off CSC debts totalling US$42 530 597, and to pay rentals of US$100 000 per annum during the first five years of the agreement.

It was also supposed to take over and run the management of CSC ranches which include Maphaneni; Dubane; Umguza; Chivumbuni; Mushandike; Willsgrove; and Darwendale for an initial period of 25 years

Boustead was also going to take over CSC abattoirs in Bulawayo; Chinhoyi; Masvingo; Marondera; and Kadoma; and distribution centres for an initial period of 25 years.

But documents shown to NewsDay Weekender have revealed that the company had its certificate of incorporation, number 9860820, on change of name issued on January 18, 2021, at the registrar of companies in England and Wales from The Rhodesian Beef Company Ltd, to Boustead Beef UK Ltd.

Boustead’s balance sheet as at November 30, 2019, showed that its net assets including cash at bank and cash in hand, and share capital of four ordinary shares of £1 each was £4.

Despite promising to inject US$130 million into CSC, the company which registered under small companies, was exempted from paying tax under section 480 of the Companies Act (2006) relating to dormant companies.

Part of the document which was signed by Boustead directors Harald Torbjorn Gabriel Jakob Kinde and Nicholas Antony Havercroft read: “The members have not required the company to obtain an audit in accordance of section 476 of the Companies Act (2006).

“The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and preparation of accounts. These accounts have been prepared in accordance with provision applicable to companies subject to the small companies’ regime approved by the board on October 30, 2020.”

However, the Boustead deal fell apart after it failed to fulfil its promised first year obligations. It had promised to invest US$45 million within the first year.

About US$6 million of the promised US$45 million was meant for refurbishment of abattoirs, canning factory, and distribution. Working capital abattoirs, canning factory, distribution were allocated US$5 million. Logistic fleet, vehicles, distribution- abattoirs were allocated US$2 million, among other financial promises.

However, nothing of the promised obligations was fulfilled.  Despite not contributing anything, the company has reportedly been stripping CSC assets.

It is reported that the company recently sold more than 200 CSC cattle at Umguza and earned more than $6 million, cut down gum trees at the Bulawayo headquarters and sold them. It is also allegedly collecting rentals from CSC properties for the past 20 months and retrenched scores of workers.

Contacted for comment, Masuka directed all questions to Vonanai Majoko who replaced Kudenga as the new corporate rescue practitioner.

“This is administrative. Refer all your questions to the corporate rescue practitioner,” Masuka said.

But Majoko said: “As you know, I am still new as a corporate rescue practitioner, I will have to call a meeting with the creditors as I am required to do that by the Act.

“After the meeting, I will be in position to tell you the correct information. Cold Storage Company has several ranches dotted around the country, so I need time to take stock of the cattle.  I can’t even tell you if there are any cattle sold, I need time to take the inventory.

He added: “As for Boustead, what I know is, we are dealing with Boustead Beef Zimbabwe Ltd. I am not qualified to tell you their relationship with Boustead Beef UK Ltd.”

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