Govt dis­solves Cottco board

Chronicle (Zimbabwe) - - Business - Harare Bureau

THE Gov­ern­ment has dis­solved the Cottco Hold­ings board, sources privy to the de­vel­op­ment said yes­ter­day, with­out pro­vid­ing full de­tails of the rea­sons for the dis­so­lu­tion.

The Gov­ern­ment, which is bankrolling the con­tract scheme of the com­pany is in the process of tak­ing over the coun­try’s largest cot­ton com­pany through a debt eq­uity swap.

While no of­fi­cial po­si­tion could be ob­tained on the rea­sons for the dis­so­lu­tion of the board, chaired by Mrs Ce­cilia Paradza, the sources said the de­ci­sion was made early this week.

“It was a high level ini­tia­tive which re­solved to dis­solve the board and the rea­sons are not clear,” said one source who re­quested not to be named for pro­fes­sional rea­sons.

Mrs Paradza said yes­ter­day “no com­mu­ni­ca­tion has been made with re­gards the is­sue”.

How­ever, The Her­ald Busi­ness un­der­stands that the Gov­ern­ment was “un­happy” with the per­for­mance of the board af­ter fail­ing to turn­around the busi­ness de­spite be­ing given sup­port in the form of in­puts.

“Now, an­other fi­nan­cial pack­age is in place for this sea­son and the share­holder and other stake­hold­ers have ex­pressed se­ri­ous reservations with the cur­rent board of di­rec­tors. That is how the de­ci­sion was made to dis­solve the board,” an­other source said.

There were also some di­vi­sions within the board, par­tic­u­larly over the fate of the act­ing man­ag­ing di­rec­tor Mr Chris Murove, who is fac­ing al­le­ga­tions of fi­nan­cial abuse and the man­ner the pro­posal by Olam In­ter­na­tional to man­age the com­pany was han­dled.

The Gov­ern­ment is in the process of tak­ing over Cottco through the Zim­babwe As­set Man­age­ment Com­pany, a spe­cial pur­pose ve­hi­cle owned by the Re­serve Bank of Zim­babwe re­spon­si­ble for ac­quir­ing, man­ag­ing, re­struc­tur­ing or dis­pos­ing of non­per­form­ing bank loans.

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