CSC in a quandary over UK investor

Politicians angling for deal to be canned

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TINASHE MAKICHI

THE multi-milliondollar deal to revive the Cold Storage Company (CSC) is under threat amid revelations that some politicians are angling for the transaction to be cancelled, citing the lack of funding on the part of the British investor, Boulstead Beef (Pvt) Limited, Business Times heard this week.

This year Cabinet approved a 25-year-long joint venture between the CSC and the British firm, Boulstead Beef, but records from the British companies registry show that Boulstead is a broke shelf company with £2 in its bank account as at 30 April 2018.

This has raised questions on the capacity of Boulstead to revive the once iconic meat processor.

But Nick Havercroft, Boulstead’s chief executive, told Business Times that the company had enough funding to execute the project and had in fact the blessing of the Zimbabwean government.

He confirmed that the deal was under attack from various circles that wanted the transaction to be cancelled.

“Your sources are not reliable but I understand why they would say this as many people are trying hard to stop this deal and want me to throw in the towel and walk away, but Honourable Minister of Agriculture Perrance Shiri is giving me 100 percent support,” Havercroft said.

Asked to comment on the prospects of the success of the deal and the availability of funds, Havercroft said, “we have a very tight control on the finance which is needed in these difficult times and current situations.”

Boustead has plans to invest US$6m into abattoirs’ refurbishment, a canning factory, distribution infrastructure, working capital and IT systems. Plant equipment worth US$500 000 has since been ordered and paid for.

Boustead will also take over and manage CSC ranches in Maphaneni, Dubane, Umguza, Chivumbuni, Mushandike, Willsgrove and Darwendale for an initial period of 25 years. In addition, Boustead will take over and run the CSC abattoirs in Bulawayo, Chinhoyi, Masvingo, Marondera and Kadoma for an initial period of 25 years.

Boulstead is alleged to have a three-member board of directors, two of them with the same second name plus the IT manager who sits on the board. There are indications that the resuscitation of CSC will go a long way in improving the economy through beef exports as it will unlock value in the livestock industry.

At its peak, CSC used to handle up to 150 000 tonnes of beef and associated by-products annually and exported to the European Union, where it had an annual quota of 9 100 tonnes of beef.

The company used to earn the country US$45m per year.