SOUTH Africa-based Zimbabwean tycoon Mutumwa Mawere has reacted with anger to government’s latest claims that he ran down his seized mining companies and siphoned millions in rands from them.
Mawere’s counter this wee
k to the allegations intensifies the protracted battle for control of the country’s largest asbestos-producing company, Shabanie Mashava Mines (SMM Holdings).
Government took over the mines from Mawere in 2004 under a specially promulgated legal instrument, Reconstruction of State-Indebted Insolvent Companies Act, claiming they were indebted to the state.
Authorities also accused Mawere of siphoning money —US$300 billion at the time — out of Zimbabwe in breach of Exchange Control regulations. Now he is being accused of running down the company through “gross negligence”.
SMM Holdings is incorporated in Zimbabwe but wholly-owned by SMM Holdings based in England, which in turn is owned by Africa Resources Ltd registered in the British Virgin Islands.
In a recent Government Gazette, SSM Holdings administrator Afaras Gwaradzimba said Mawere and others were personally liable for the company’s current liabilities.
He said Mawere owed the mines $66,6 million, R53 million, US$56,5 million, 625 000 Canadian dollars and 138 000 British pounds. Part of the money were debts incurred during the mines’ reconstruction.
Government claims to have injected $100 million ($100 billion in real terms) as working capital after it took over the mining group.
Mawere, who has taken the issue of the seizure of his mining group to the International Monetary Fund and World Bank, said government claims against him raised “legal, institutional, political, extra-judicial, corruption, and extra-territorial issues that need to be tackled head on”.
“Why would a government that had failed to establish a case against me in South Africa, a foreign jurisdiction, proceed to target me under Zimbabwean law when it knows I’m no longer President Mugabe’s subject?” Mawere said. “I have repeatedly said there is an ulterior motive to this.”
Mawere said government was doing all this to secure nationalisation of his companies.
“To justify the illegality of actions of the government the decree was crafted on the basis that my companies were indebted to the state,” he said.
“However, the reconstruction is not only faulty in that there is no persona that exists at law called the state but also in that my companies were not indebted to the state as claimed. But in Zimbabwe today the end justifies the means as long as the great leader or the deal leader dictates.”
Mawere said it was irrational that the Zimbabwean government was also now trying to seize his companies registered outside the country.
“Under what construction would an administrator appointed by Mugabe be responsible for affairs of companies registered outside the jurisdiction of Zimbabwe?” he queried.
“How does Zimbabwe law end up having extra-territorial application as if South Africa is a province of Zimbabwe? Is it the role of government to take over private companies? It is high time that we expose these barbarians who present themselves as a Salvation Army with an underlying criminal intent.” — Staff Writer.