eBusiness Weekly
Business Writer
City businessman, Fred Mutanda, has appointed a consultant to implement the resolutions of the CAPS Holdings’ extra ordinary general meeting held in June 2011 entailing share consolidation and de-merger of the group into three entities.
Mutanda, who is at loggerheads with the Government over ownership of the group said the resolutions would pave way for implementation of the share purchase agreement entered between the businessman and the Government in November 2011 on the disposal of CAPS Manufacturing and CAPS Healthcare, which owns QV Pharmacies and St Annes Hospital, after the de-merger.
Mutanda owns 88 percent stake in CAPS Holdings through his family investment vehicle, FCMM. Apiece, he directly owns 88 percent of CAPS Manufacturing and CAPS Healthcare.
Other entities, solely owned by CAPS Holdings, are CAPS Botswana Limited, CAPS Pharmaceuticals South Africa Limited, CAPS International as well as Geddes.
While the Government, through the Reserve Bank of Zimbabwe (RBZ) offered to acquire the two entities for US$20 million in November 2015, Mutanda maintains he “remains the rightful” owner of CAPS after the businessman rejected the RTGS which the central bank wanted to pay in lieu of the US treasury bills.
Mutanda is insisting on payment in US dollars as per agreement with Government.
The agreement entailed the Government, through the RBZ would issue TBs to Mutanda.
Mutanda argued it was unfair to redeem the maturing TBs in local currency given that the agreement between him and the Government was in United States dollars.
Putting aside payment issues, CAPS Holdings, in which Mutanda owns 88 percent stake, needed to be demerged into three entities. This would have resulted in the Government taking over CAPS Manufacturing and CAPS Healthcare.
In a letter to the Minister of Industry and Commerce Dr Sekai Nzenza dated April 28, 2022, Mutanda advised that he had appointed Chris Mazarire as the consultant to facilitate and finalise the proposal by the Government to buy the de-merged entities of CAPS Holdings — CAPS Manufacturing and CAPS Healthcare.
“In pursuit of the intent stated in my letter of 08 April 2022, be pleased to take notice that, as ultimate beneficiary shareholder of most of the issued and full paid ordinary shares of CAPS Holdings Limited, and with immediate effect, I have appointed and formally mandated an investment banking and enterprise governance professional, one Christmas Mazarire,” said Mr Mutanda.
“In brief, the scope of mandate granted to Chris Mazarire is to ensure…a seamless divestiture action plan or program regarding my existing shareholding in CAPS Holdings Limited and that of those investment entities, which I directly control,” he said.
Earlier, Mutanda had written to Deputy Finance and Economic Development Minister Clemence Chiduwa on April 8, 2022, saying the existing shareholding structure “shall change upon implementation of resolutions passed in a general meeting of members of CAPS Holdings Limited on 30 June 2011.”
“In terms of those resolutions, CAPS Holdings Limited is to be unbundled,” said Mutanda.
“Put simply, existing shareholders of CAPS Holdings Limited would end up directly holding issued and paid-up ordinary shares in the unbundled new entities.”
Several calls seeking comments from Dr Nzenza and Chiduwa were not answered.
In an interview, Mutanda said the resolutions of the April 2011 EGM remained unfulfilled. “What the Government offered to buy was CAPS Manufacturing and CAPS Healthcare; not the holding firm,” said Mutanda.
“There was need to demerge the holding company so that CAPS Manufacturing and CAPS Healthcare would become standalone entities; those are the companies which the government offered to buy.
“This did not happen and this is what we are now rectifying. If the Government is still interested to pay for the two entities, they can still proceed in terms of the agreement but if it cannot, they I have no option but to find other interested buyers.”
