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Meikles blames MP, detractors for RBZ loan repayment delay

10/04/2015 00:00:00
by The Source
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HOSPITALITY and retail group Meikles Limited, which claims it is owed $90 million in debt and interest by the central bank on Thursday blamed the Zimbabwe Stock Exchange, an unnamed lawmaker and other detractors for the delay in the repayment of the debt.

The Meikles debt accrued in 1998 from transactions related to the group’s dual listing on the Zimbabwe Stock Exchange and the London Stock Exchange.

Information before Parliament, which is set to pass the Reserve Bank Debt Assumption Bill, is that the Meikles debt stood at $25 million in 1998 but shot up to $47 million at the end of 2013 after the inclusion of interest.

The company in February this year clashed with the Zimbabwe Stock Exchange and regulator, the Securities Commission of Zimbabwe and was temporarily suspended from trading on the bourse on allegations of overstating the RBZ debt with the intention of manipulating its price on the stock market.

Meikles’ half-year results to 30 September 2014 showed the balance with RBZ as $43,738 million and TBs of $38,431 million totalling $82,169 million, a decrease in value by $8,63 million.

On Thursday, chairman John Moxon said the group had gathered information through its intelligence systems that there were individuals working against the company’s interests.

“These efforts that began in October 2014 overtly, but earlier in practice, are a concerted effort by individuals, including at least one Member of Parliament, some but certainly not all ex-employees who are unhappy following their removal from office, which in fact was well deserved, and now more recently the ZSE, to disrupt negotiations on the settlement sums due to the company, the placing of TB’s on the market and generally to damage the company’s reputation and well being,” he said in a statement.

While he did not name the MP, in December last year he fell out with Bulawayo South legislator Eddie Cross, who is also a shareholder in the firm, for allegedly using insider information for his personal benefit in contravention of Parliament rules.

Cross was later cleared by Parliament of any wrong doing.

Moxon said the delay had resulted in further damage to the group.

“Implications arising from the delay will only become apparent in their severity in future months and will, where necessary, be communicated to the public,” he said.


Moxon however said a substantial part of the funds had been committed to the group by RBZ in writing but pointed that the agreed timeline had not been adhered to.

“The ultimate value of the funds which have largely, but not entirely, been committed in the form of Treasury Bills is still unknown,” he said.

“The greater number of these TB’s which are about to be issued with satisfactory terms are still to be received by the company and are still to be placed in the market.

“The company is of the opinion that it cannot predict matters pertaining to the receipt, or value of the funds with precision.”

He said arrangements were being finalized with the RBZ to enable the company to implement a substantial part of its strategic objectives.

“The implementation of the strategic plans for the enhancement of shareholder values are of necessity delayed, but will resume as soon as the company’s forward direction from a shareholder perspective has been determined,” he said.

Moxon said progress on the matter should not be discussed in public as this would not benefit shareholders.

The company has since sued ZSE and the case is still pending before the courts.

Moxon said in the meantime the company would consider how best to advance its interests “in the best possible manner and which may perhaps be outside the framework of the ZSE,” but did not say whether this involved delisting.

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