Harare, (New Ziana) – Meat processor, Cold Storage Company (CSC) has been placed under a court sanctioned corporate
rescue plan which protects the company from litigation as efforts are being made to revitalise the struggling firm, a cabinet minister said on Sunday.
The stare owned company entered into a joint venture agreement with United Kingdom based Boustead Beef in 2019 under which the latter was supposed to spearhead the revival of CSC, including extinguishing its huge debts.
But implementation of the deal faced hurdles, forcing government to seek protection through the courts, through application for a corporate rescue plan, which was granted by the High Court on December 3 last year.
“The objective is to avoid liquidation and bring CSC back to profitability and contribute to the Livestock Growth Plan and National Development Strategy 1,” said Lands, Agriculture, Water and Rural Resettlement Minister, Dr Anxious Masuka.
Ngoni Kudenga of BDO Zimbabwe Chartered Accountants was appointed as the corporate rescue practitioner and will be in charge of CSC until the process has been completed.
Dr Masuka said the plan gave the firm relief from litigation, while it empowered Kudenga to thoroughly investigate the company’s business affairs, and financial situation in terms of the Insolvency Act.
Among others, he is also expected to ascertain the number of CSC properties and other assets, investigate previous operations and expose weaknesses, as well as adherence to good corporate governance Boustead Beef, had been expected to inject up to US$130 million into CSC in a deal in which the UK based firm would get a 25 year concession to recoup its investment.
“The upside is enormous and we should not be worried about the concession period (of 25 years). We will be able to get value for money on this,” Finance and Economic Development Minister, Mthuli Ncube said about the deal in 2019.
Besides reviving CSC’s dwindling cattle herd, which was less than 350 in 2017, Boustead Beef was envisioned to re-open the firm’s derelict abattoirs, meat processing and canning factory as well as tannery.
Thousands of jobs were expected to be created.
“The company will employ people and will start exporting to China, Botswana and Angola. The benefits are incredible for the economy…” Prof Ncube said.
New Ziana
