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TZI wants sold Strategis stake back

Conrad Dube/Augustine Mukaro

TZI is contemplating reversing the sale of a 25% stake in Strategis Africa after a management-led consortium failed to pay for the shares.

rdana, Arial, Helvetica, sans-serif”>The consortium now running Strategis Africa took over the company from TZI two years ago but has since failed to raise the asking price of US$300 000 required for them to secure the 25% stake.

Documents in the possession of business- digest reveal that the consortium, led by Strategis chief executive Fungai Muparadzi, has not paid for the stake it “bought” in 2003.

Under the deal, Strategis managers had agreed to pay US$300 000 for the 25% stake in the company while the remaining 75% was placed in a trust known as the Strategis Africa Trust. This was done on condition that if the trustees sold or swapped the shareholding in Strategis Africa, the proceeds or, failing that, the original shares in Strategis Africa would be distributed to the owners of TZI on January 6 2004.

TZI is also planning to block any transaction that might have a material impact on the operations or value of Strategis. They are also planning to scuttle Strategis’ bid to list on the Zimbabwe Stock Exchange (ZSE). TZI has also vowed to block Strategis’s proposed deal with MedTech Holdings.

The company is expected to lodge an interdict with the High Court next week to stop the agreements signed by Strategis and listed MedTech Holdings.

In terms of the threatened deal, Strategis was planning to make a reverse listing through a technical merger with quoted medical inventories trader.

MedTech would pool its interest in Baines Imaging with Strategis’ 60% shareholding in Accord Services (Pvt) Ltd (trading as Mars Zimbabwe).

It would also add its 25% interest in Maintop Investments (Pvt) Ltd, trading as Clinical Laboratories, under a new intermediary services holding company.

MedTech would also combine MedTech Distribution and Consumer Products with Strategies’ 100% interest in Zimbabwe Pharmaceuticals (Pvt) Ltd also under an intermediary consumer goods sales and manufacturing holding company.

TZI chief executive Edwin Moyo last week wrote to ZSE chief executive Emmanuel Munyukwi seeking intervention on the matter to ensure that the MedTech-Strategis deal does not sail through unless Strategis management pay up.

“I have been in contact with Mr Fungai Muparadzi of Strategis Africa on three occasions with regards to confirmation of the payment of the US$300 000, being the 25% management-led stake. To date, I have had no response. As far as TZI is concerned there is no evidence to show that the US$300 000 for the management-led stake was paid to TZI,” said Moyo in a letter to Munyukwi.

“In respect of the 75% Strategis Africa shareholding/dividend which was due top TZI shareholders as at January 6 2004, a year has now passed and no dividend has been awarded to TZI shareholders neither has any shareholding in Strategis Africa/International been awarded to these same shareholders, as promised in the chief executive’s (former TZI chief executive Hillary Duckworth) review on November 28 2003 report,” Moyo added.

Moyo said evidence points to the fact that as at September 30 2004 (TZI financial year-end), Strategies Africa/International was still a TZI asset. In terms of the audit, according Moyo’s correspondence to Munyukwi, there is therefore need to consolidate its value into the TZI September 2004 audited accounts.

“We have also established that significant developments have occurred in respect of a transaction between the ZSE listed MedTech Holdings and Strategis Africa/International Ltd. We would request that full disclosures be made to TZI as a pre-requisite to the sanctioning of this transaction, especially in light of the above developments,” Moyo said.

“We therefore seek the ZSE’s intervention in these matters and ensure that shareholders’ interests in both these transactions are protected,” he said. Strategis Africa Trust was set-up on March 31 2004. Stenham Trustees Ltd are the trustees and Hillary Duckworth (former TZI chief executive) is the enforcer.

Assets transferred into the trust were US$25 000 and 900 class A ordinary shares in Strategis International Group Ltd. The trust’s brief was to hold shares in Strategis until they could be sold at the appropriate. The trust would then receive the sale proceeds, pay the trust fees and then pay the remaining funds into a distribution account where payments would be made to the relevant persons.

Documents in our possession show that Moyo on April 15 wrote to Muparadzi informing him that TZI would seek legal recourse on the matter.

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