By Mary Taruvinga
FLY AFRICA Zimbabwe is in trouble with the law after it allegedly failed to settle a US$4million loan facility it borrowed from a Mauritius registered company, Blossom View Holdings (Pvt) Ltd.
Fly Africa Zimbabwe was a low-cost carrier based at the Robert Mugabe International Airport operating under a joint venture between Fly Africa Zimbabwe and Nu Aero (Pvt) Ltd.
The case has spilled into the courts and through its local lawyers, Masiya-Sheshe and Associates, Blossom View recently issued summons against Nu Aero t/a Fly Africa Zimbabwe and Hopalong Cassidy Chitariso Mugwagwa, seeking confirmation of cancellation of a loan facility and payment of the owed cash.
Court papers show Blossom View is a foreign corporate entity registered in accordance with the laws of Mauritius, but entered and signed a loan facility agreement with Fly Africa Zimbabwe on November 8, 2019.
It has been submitted that on the date in question, it entered into an agreement with Nu Aero in terms of which it extended a loan facility in the sum of US$4 million upon a written request by Mugwagwa’s company.
“It was a material term of the agreement that all disbursements under the said term sheet were at the sole and absolute discretion of the plaintiff (Blossom View Holdings).
“In terms of the signed term sheet for the loan facility, the first defendant (Nu Aero) undertook to repay the amount drawn down quarterly after the grace period of 60 days. The first defendant also agreed and signed that any interest on the loan advanced would be at 10% per month,” reads the court papers.
“The first defendant made its first drawdown request on November 10, 2019. Further requests of drawdowns were made resulting in the defendants drawing down US$1 710 622 by July 3, 2020, and accumulating an interest of US$1 204 355 bringing the total inclusive of loan and interest to US$2 914 978,” wrote the lawyers.
It is alleged that after securing the said loan facility, Nu Aero only made a single payment of ZAR1 906 000 which translated to US$42 265 on January 10, 2020, which amount was apportioned towards reduction of interest.