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Archer Clothing

Prosper Ndlovu, Business Editor
ARCHER Clothing Manufacturers is set to exit provisional liquidation, a move that is likely to open a new chapter for the struggling Bulawayo-based company.

Archer was placed under judicial management in 2010 and provisional liquidation last year due to lack of working capital that forced it to scale down operations and render dozens of workers jobless.

However, in March 2014 its creditors approved a takeover deal by Paramount Garments, a Harare-based clothing firm, saving it from liquidation.

Provisional liquidation refers to a court appointment of a liquidator to a company for the period between the filing of the application to wind up the company and the court hearing of the application.

The judicial manager and liquidator, Philip Ndlovu of Pna Chartered Accountants, in a notice yesterday hinted that Archer was headed for a historic breakthrough.

“As soon as the necessary formalities are completed the company will be removed from provisional liquidation,” said Ndlovu.

“The distribution account has been prepared in accordance to the scheme of arrangement approved by creditors …at a meeting held on January 14, 2015. All creditors for Archer Clothing are advised to go to the Master’s Office of the High Court of Zimbabwe in Bulawayo to view the distribution account, which lies ready for inspection.”

Despite stakeholder bickering over the takeover of the firm, Paramount Garments has injected close to $2 million of the required $5 million, which has helped reposition the company on recovery path.

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

Under the arrangement Paramount supplied clothing material and labour while Archer provided working space.

After the first vote by creditors last year, 44 out of 45 creditors approved Paramount bid except one believed to be CBZ, whose objection over an estimated $3,8 million debt, has been blamed for delaying the whole process.

Affirmative Action Group (AAG) vice president, Sam Ncube, whose organisation has been vocal during the debate over the takeover deal, said the removal of Archer from provisional liquidation was good news for Bulawayo.

“This means the company is doing well. Most companies that go through provisional liquidation end up winding up business. The Archer experience is good news for people of Bulawayo and for us as AAG as we were involved in the process,” said Ncube.

“This shows that it is possible to revive ailing companies in Bulawayo as long as there is commitment. Through partnerships and joint ventures, all our companies can be put back to life. It’s our hope that the anticipated Special Economic Zones will also help resuscitate many firms in this city.”

Archer Clothing has since recruited more than 500 workers, mainly former employees, and is targeting reaching a staff complement of 800.

The government and private finance bodies have also lauded the Archer experience, which has become one of the success stories in the country.