EYEBROWS have been raised over the experience and capacity of Diaspora Infrastructure Development Group (Pvt) Ltd (DIDG), which is partnering South Africa’s Transnet in a joint bid for the National Railways of Zimbabwe (NRZ)’s US$400 million recapitalisation tender.
By Hazel Ndebele
The parastatal is seeking a turnaround strategic partner, but a mismatch in its balance sheet has largely kept investors at bay. NRZ owes its creditors US$144 million, on top of the US$68 million in outstanding salaries. Its infrastructure has deteriorated over the last two decades and needs almost a complete overhaul.
Background checks conducted by the Zimbabwe Independent show that DIDG, one of the six investors shortlisted for the recapitalisation of the state-owned NRZ, was only registered as a company in Zimbabwe on March 14 2017.
Questions have been raised over the company’s experience, capacity and what it will bring to the table.
The company, it seems, is an outfit specifically formed for the NRZ tender.
Investigations show that the company was also registered under the same name in South Africa on March 6 2017 and was issued a registration certificate by the Companies and Intellectual Property Commission of South Africa. However, one of the company’s directors told a local weekly in March that the company was formed late last year and registered in South Africa although it was working on establishing itself in Zimbabwe.
Documents from the Company Registry in Harare show that DIDG offices were first set up at number 5842 Bulawayo Road, Norton, but the directors have since updated the company’s file to state that the company is operating from 10 York Avenue, Newlands, Harare, with effect from July 1 2017.
But when the Independent visited the Newlands premises, it discovered that DIDG was not housed at the premises. Instead, those premises are occupied by Costa and Madzonga Legal Practitioners, which has nothing to do with DIDG.
The South African director of DIDG is Cameron Ian, while the directors of the subsidiary in Zimbabwe are Washington Mashanda, Frank Thema and Donovan Antony Chimhandamba.
Mashanda owns a company based in South Africa called Tarinaka which is into branding, graphic design, printing, marketing, communication and consulting. Thema, according to his LinkedIn profile, is a professional working as head of project management for Zurich Insurance Company in South Africa. Chimhandamba is also based in South Africa and is the chief executive of Nyanza Light Metals and Arkein International Limited.
Messages sent to the directors on their Facebook accounts had not been responded to by the time of going to print.
DIDG, in its tender application, indicated it could provide US$400 million.
The dominant business of DIDG, according to its documents, is into infrastructure investments and development.
Over 20 firms expressed an interest to invest in the NRZ in a debt or equity deal, but the State Procurement Board shortlisted six bidders a fortnight ago. Of the six, only three appeared to have met the tender requirements.
The other companies are a Swiss firm, Crowe Horwath Chartered Accountants, which said it could secure funding amounting to US$2,5 billion, and a local firm, Croyeaux (Pvt) Limited, which proposed to inject about US$700 million.
No information could be found on Croyeaux (Pvt) Ltd at the Company Registry. The firm is registered, but its file is missing.
China’s Sino Hydro only submitted what was referred to as a “regret”, while China Civil Engineering asked for a late submission. The sixth firm, SMH Rail of Malaysia, said it could re-manufacture some of the infrastructure and submitted a tender with a funding proposal of about US$101 million.
NRZ board chair Larry Mavima said it would be grossly unfair and unprofessional to comment on the companies involved before finalisation of the process.
“We are in a closed period whereby the adjudication committee is working towards providing the board with best suitable candidates for the tender and therefore I cannot comment on the companies involved, at least for now,” said Mavima.
“I can assure you that the committee is experienced and will look to verify if the companies chosen meet the requirements. The committee will then submit recommendations to the board for the final decision.”