AAG steps into Archer takeover row The Affirmative Action Group (AAG) says it will not allow creditors’ bickering to hold back the revival of Archer Clothing

Oliver Kazunga Acting Business Editor—
THE Affirmative Action Group (AAG) says it will not allow creditors’ bickering to hold back the revival of Archer Clothing by Paramount Garments. Archer creditors last March approved its takeover by Paramount Garments at the High Court, saving it from liquidation and raising hope that one of Bulawayo’s oldest companies and major employer would be revived.

The takeover negotiations between the two companies started in 2013 after they initially entered into a cut, make and trim deal.

Under the deal the Harare firm supplied clothing material and labour while Archer provided working space.

At the first vote last year, 44 out of the 45 creditors approved the Paramount bid, but one dissenter’s objection delayed the process.

Another attempt to take over the firm suffered a still birth after a creditors and members’ meeting that was set for November 5 last year failed to take place.

This saw Archer Clothing being given up to this month to conclude the takeover by Paramount or risk being liquidated, throwing more than 200 workers recruited in September 2014 out of work.

According to media reports, 33 out of the 34 creditors who were owed more than $14 million, last week approved the Paramount bid while one creditor believed to be CBZ Bank, which was owed $3,8 million, voted against the takeover deal.

In an interview yesterday, AAG national vice president Sam Ncube said CBZ should not stall the takeover.

“At the Archer creditors meeting held last week, out of the 34 creditors only CBZ Bank voted against the takeover of the company by a Harare-based company.

“As AAG we can’t accept that as the takeover of Archer will create employment in the city and other downstream industries tend to benefit from resumption of operations by Archer.

“CBZ being owned by the government, we’ll soon approach the government to address the Archer creditors bickering so that operations at the firm are revived.”

Archer was established in 1953 and before its collapse was among the largest garment manufacturers in the country.

Although the takeover deal was yet to be concluded, Paramount Garments has so far committed $2 million towards Archer’s revival.

The firm requires about $5 million capital injection in the long-term to refurbish property, machinery, cater for human resources and working capital.

It was placed under judicial management in 2010 and provisional liquidation last year due to lack of working capital before scaling down operations, leaving hundreds of workers redundant.

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