SMM Holdings administrator Afaras Gwaradzimba has so far been paid a staggering $3 billion by Turnall Holdings for his services over the past six months as part of the company’s share of the
costs of his services to the whole group.
This represents 6% of the company’s turnover in the past six months.
Gwaradzimba’s fees are likely to balloon to $15 billion when two other listed companies under the SMM group – Steelnet Zimbabwe and General Belting – make provisions in their half year results.
SMM’s mining operation, Shabani Mashava Mines, will also be required to contribute to the curator’s fees. Gwaradzimba has since invoiced SMM Holdings for his services as administrator of the companies.
SMM in turn ordered its companies to provide for payments to Gwaradzimba from their turnovers as provided for in the reconstruction order.
FSI and all its subsidiaries will also make a contribution to the administrator’s fee.
Under the reconstruction order of 2004, companies under the SMM group are required to pay 6% of their turnover as the administrator’s fees.
Gwaradzimba refused to divulge the exact net amount he would receive from SMM Holdings and its subsidiaries, but confirmed that he had sent an invoice for his services to the group.
“I cannot give you the exact figure as to how much I will get, because I do not have it at hand. All I can say is, I have sent out an invoice to SMM for my services,” Gwaradzimba said.
He said the amount charged was in accordance with the provisions of his services to all companies under SMM.
“We have charged fees in accordance with the provisions of the reconstruction order, it’s complicated as to how we come to the amount,” said Gwaradzimba.
Steelnet managing director David MacCann could not be drawn into disclosing the amount his company was going to pay to Gwaradzimba.
“I am sorry I cannot be of much help as the company is in a closed period until we release our results towards the end of the month,” MacCann said. Businessdigest however understands that Gwaradzimba’s fees are likely to surpass $15 billion in total.
The latest controversy over Gwaradzimba comes after Mutumwa Mawere’s British lawyers, Arlington Sharmas Solicitors accused him of being a front in the government efforts to strip him of his local assets.
The lawyers accused Gwaradzimba’s company, AMG Global of being used to house shares which will be handed over to the government after completion of the reconstruction process.
The accusation by the British lawyers is part of a legal challenge that Mawere is making against the takeover of his assets and properties by the government.
The multi-faceted legal action is also challenging the placing of his companies under the management of an administrator.
Bhadresh Gohil of Arlington Sharmas Solicitors further states in a two-page dossier that it appears “government took a preemptive strike” in order to expropriate Mawere’s assets.
They said it was troubling that the state was using a private entity and front, whose relationship with the state has not been revealed.
Turnall Holdings in the period under review recorded an increase in turnover of 207% to close the half year at $219,3 billion while its operating profit increased 1128% to end the half year at $74,2 billion.