24 March 2011

Zimbabwe: Millenium Tobacco Applies for Licence

A COMPANY linked to former Zimbabwe Industry Tobacco Auction Centre (Zitac) workers and a Zanu PF lawmaker have applied for a tobacco licence, businessdigest has established.

The development could bring to three the number of tobacco auctioneers operating in the country.

It has emerged that Millennium Tobacco could soon secure an operating licence should it meet regulatory requirements set by the Tobacco Industry and Marketing Board (TIMB).

Industry sources said the company is co-owned by former workers of financially beleaguered Zitac and Muzarabani South MP Edward Raradza.

CEO Andrew Matibiri this week confirmed that the tobacco regulator's board is considering an application made by Millennium Tobacco, although he could not be drawn to comment on the company's shareholders.

He, however, said the TIMB had met on Wednesday to deliberate on the licensing of the company.

"Management of TIMB has carried out two inspections of the premises and a report was presented for consideration," said Matibiri in a telephone interview on Wednesday.

"There are certain requirements (for licensing) that will be communicated to them."

Sources said Millenium Tobacco would operate from Msasa-based Farmers' World Holdings premises, owned by Raradza.

Farmers World recorded brisk business during the Reserve Bank-funded farm mechanisation exercise which was aimed at retooling newly resettled farmers under the controversial land reform programme. Transtobac complex, which houses Farmers World, has in recent years been used as a tobacco warehouse.

The sources added that Zitac finance manager Richard Chabata would also join the company. Zitac CEO Philemon Mangena would not comment saying he was in a meeting.

Zimbabwe is currently operating a single auction floor, Tobacco Sales Floor (TSF) since the onset of the tobacco marketing season mid last month. Boka Tobacco Sales Floor is currently undergoing renovation. Another tobacco auction floor, BMZ, closed down last year.

Boka Investments, owners of the largest auction floors, are also at the centre of a legal wrangle with former operators Zitac.

Boka Investments dragged Zitac to the courts after accusing the firm of violating a decade-long lease agreement.

Zitac's bid to fight Boka in the courts was dealt a big blow when the courts last month placed the embattled tobacco buyer under provisional liquidation.

Last year, tobacco growers sold the cash crop to Zitac and TSF after BMZ closed down.

Meanwhile, Zitac shareholders have made an urgent High Court application challenging the placing of their embattled company under provisional liquidation.

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