HomeBusiness DigestGwaradzimba acquires SMM

Gwaradzimba acquires SMM

SMM Holdings Ltd (SMM) administrator Afaras Gwaradzimba has acquired the asbestos concern for US$2 million on behalf of the government of Zimbabwe, it has emerged.

“>The transfer of shares means government has now taken full control of the company from businessman, Mutumwa Mawere.

The takeover, done through Gwaradzimba’s AMG Global Nominees (Pvt) Ltd (AMG), is now the subject of a legal wrangle between Mawere and the Harare-based chartered accountant.

Gwaradzimba was last year appointed administrator of SMM in a move to expropriate Mawere’s companies. Mawere is accused of externalising $300 billion in unremitted foreign currency from the sale of asbestos.

Mawere has filed lawsuits in Zimbabwe and Britain to challenge the takeover of SMM through the deal brokered by Gwaradzimba.

Gwaradzimba, court papers say, approached former SMM owners, Turner & Newall (T&N), in November last year and laid out his case to buy the chrysotile company on the basis that he was its administrator here.

The Zimbabwean accounting guru not only acquired SMM shares, but Turnall Holdings Zimbabwe Ltd (THZ), too.

“On 5 November 2004, T&N plc (in administration) and AMG Nominees… concluded an agreement for the sale and purchase of the SMMH shares and the THZ shares for the total sum of US$2 million.

“The 2004 SPA (purchase and sale agreement) was duly completed on 30 November, and pursuant to clause 2,2 thereof, T&N plc (in administration) delivered to AMG Nominees… two share warrants, both dated 6 March 1996, in respect of the SMMH ordinary shares and the THZ ordinary shares,” Gwaradzimba wrote in a February 28 opposing affidavit.

He also said the purchase of the shares “ensured I as the administrator, would have control over all companies in Zimbabwe linked to SMM”. He said the transaction had the blessings of the Reserve Bank of Zimbabwe.

Gwaradzimba also justified the purchase saying Mawere’s Africa Resources Ltd (ARL), the parent company of SMM, had defaulted on the US$60 million.

Gwaradzimba said ARL had infringed clause 8 of the 1996 memorandum of deposit, which empowered T&N managers to sell to other parties.

Mawere, who values his business at US$300 million, disputes the take-over price of US$2 million.

Gwaradzimba says SMM’s purchase was made as part of Justice minister Patrick Chinamasa’s reconstruction order last year.

Chinamasa, who is listed as a respondent in the case, yesterday declined to comment on the issue.

However, Mawere, who masterminded the 1996 takeover of SMM 1996 with the help of KBC Bank of England, disputes Gwaradzimba’s takeover account, saying he was “motivated by a desire to expropriate my beneficial ownership in all assets deemed to be controlled by me” without due compensation.

Despite claiming insolvency of SMM and circulating a report on the company’s finances, ARL and its operating subsidiary never saw the purported report, which was instead sent to T&N’s administrators, Mawere said.

The asbestos and financial mogul argues T&N is not an SMM shareholder, but held shares in trust until such a time the Zimbabwean investors had fully paid the purchase price.

Mawere argues that SMM had paid an amount in the region of US$37

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