DETAILS of suspended Zimbabwe Mirror Newspapers Group CEO and editor-in-chief Ibbo Mandaza’s exit strategy from the papers that have been taken over by the intelligence service emerged this w
Documents show that Mandaza had proposed that his Southern African Printing and Publishing House (Sappho), now split into two entities and which hold 30% in the Mirror group, should withdraw by selling its interest in the company through a new agreement of sale.
The Central Intelligence Organisation (CIO) has taken over the Mirror’s two titles, the Daily Mirror and Sunday Mirror, as well as the Financial Gazette through an ownership front. The state security agency also has influence in other media organisations and is trying to expand its tentacles.
Mandaza suggested a valuation of the company and a resale of the 70% of the Mirror to Unique World Investments and Zistanbal Investments which already controlled 70% shareholding in the Mirror.
“Unique and Zistanbal will pay the requisite purchase price, based on the current valuation – which is to be undertaken immediately by a firm of accountants to be mutually agreed upon by the three parties of the Mirror group,” the documents say.
This would take into account the $924 million paid by Unique and Zistanbal “plus the interest thereof, calculated on the basis of the dates on which the monies were variously disbursed in the period August 2003 to late January 2004 and the applicable interest rates thereof”.
“Sappho will then sell the remaining 30% shareholding to a third party, negotiations with whom are in progress. Obviously, this proposal is neat and also provides an appropriate business-type framework,” the documents say.
“Also, it would be media-friendly and puts a favourable end to the kind of media speculation that has been attendant to this matter over the last few weeks.”
The modalities of sale and transfer were supposed to be completed by September 30 after which Sappho would no longer be a shareholder in the Mirror and Mandaza’s securities and guarantees at the Jewel Bank, the company’s bankers, would be cancelled.
However, the CIO rejected Mandaza’s proposal and came up with a different modality for his withdrawal. They refused to have an evaluation and an effective resale of the 70%, suggesting Sappho should just sell its 30% to Unique and Zistanbal and move out.
“Sappho Holdings is (should be) selling the remaining 30% shareholding to the remaining partners, who will then share it between themselves in proportion to their existing shareholding,” the documents say.
“Thus, Unique (the CIO shelf company) will be entitled to 21%, thereby increasing its shareholding to 72%, and Zistanbal to 28%, with the cash transaction being based on an evaluation to be agreed upon.”
At a time when Mandaza thought the issue was still being discussed, the CIO had already finalised their plans and concluded that “Sappho is no longer a shareholder in the Mirror and will immediately have all its securities cancelled at the bank, and all monies owing duly paid”.
The CIO, however, agreed with Mandaza that the “editorial policy of the Mirror newspapers has been consistently nationalist and pan-Africanist ever since their inception in December 1997 and that this is a policy to be maintained and sustained regardless of the ownership”.
Their proposal also indicated that Unique and Zistanbal “will proceed to appoint new editors of the newspapers as it has been agreed that Mandaza will cease being CEO and editor-in-chief as from October 1 2005.”