Financial Gazette (Harare)
Shame Makoshori
2 July 2009
Harare — THE demerger of Kingdom Meikles Africa Limited (KMAL) took a new twist this week as BCA Consulting Services - the government appointed forensic auditor probing allegations of externalisation against the group - threatened to invoke the Prevention of Corruption Act arguing that the Meikles family cast an illegal vote at an extraordinary general (EGM) meeting that approved the unbundling of the group.
BCA executive Budhama Chikamhi told The Financial Gazette this week that his company would be taking up the issue with the relevant authorities to ensure that justice is done.
"It is an issue we are pursuing in terms of the Prevention of Corruption Act," he said. "We understand they (Meikles family) voted, we will not say anything more at this moment in time but as I said, it is an issue we are still pursuing," Chikamhi said.
The Financial Gazette can reveal that hardliners in President Robert Mugabe's government were stung by the Meikles family's actions and were looking for ways to punish them for ignoring the specification order slapped on John Moxon, the former KMAL chairman and other members of the family, including the investment vehicles they represent.
If carried through, BCA's threats could reopen ugly scenarios in the battle for the control of KMAL, whose marriage collapsed less than 24 months after the vows had been exchanged in 2007 as boardroom fights between Moxon and KMAL chief executive officer (CEO) Nigel Chanakira escalated.
BCA had written to KMAL chairman, Muchadeyi Masunda, twice before the demerger demanding that Moxon, who represented the interests of the Meikles family, with 43 percent shareholding, could not vote at the EGM because of the pending externalisation charges that resulted in his specification in January.
But the demands met fierce resistance from Moxon's legal counsel, Stanford Moyo, who declared the specification had been made by an un-appointed minister, had not been gazetted, and was therefore illegal.
Attorney General (AG) Johannes Tomana was not at liberty to discuss the effects of Monday's developments at KMAL but hinted the government had been enraged by the Meikles family's vote.
"The only people who can give you a comprehensive response, who have been tasked by the government to look into the issue are BCA. Ask them why these people behaved as if everything was normal," the AG said.
But as the action continues non-stop in this saga, Econet Wireless Capital (EWC) declared this week that it had no intention of divesting from Kingdom Financial Holdings Limited (KFHL) or from Meikles Africa Limited.
"EWC, the investment arm of Econet Wireless Zimbabwe, has no immediate plans to sell its stakes in Meikles, or KFHL, following the completion of the de-merger and the re-listing of KFHL," corporate communications manager, Rangarirai Mberi told The Financial Gazette.
"EWC believes that the demerger will allow management in both companies to focus their attention on creating shareholder value, by developing the businesses to their full potential. The overwhelming decision by the shareholders, who are the owners of these businesses, to de-merge them, fully vindicates Econet's view that this was the best way forward under the circumstances," Mberi added.
KMAL, the result of a merger in 2007 between Meikles Africa Limited, Tanganda Tea Limited, Cotton Printers and financial services group, Kingdom Financial Holdings Limited, had been dogged by boardroom squabbles since Moxon tried to dispose of the Cape Grace Hotel in South Africa.
The demerger, which was championed by Strive Masiyiwa's EWC, the 10 percent shareholder in the unbundled firm, shattered Chanakira's ambitious dream to make history by listing on Wall Street, the world's largest bourse.
The EWC action also left many wondering if Masiyiwa had dumped long time business associate, Chanakira to strike a new understanding with Moxon, which could result in the mobile firm pulling out of KFHL.
Chanakira, who many saw as the biggest loser in the transaction, had bigger dreams for the merged group - a 25 year vision to transform it into a formidable force in Africa, and a much bigger programme to take on the best in the world.
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