Corporate rescue a legal nullity:Telecel
Nqobile Bhebhe, [email protected]
TELECOMS operator, Telecel Zimbabwe, says it is still operational and providing its services as normal despite the Government Gazette notice on the firm’s placement under corporate rescue, board chairman, Dr James Makamba, has said.
A Government Gazette published on May 12, 2023 indicated that legal proceedings to place the smallest of the three mobile phone operators in the country under corporate rescue had commenced.
This was after the Communication and Allied Service Workers Union of Zimbabwe application lodged in October last year triggered the corporate rescue case.
However, in a statement, Dr Makamba dismissed the notice as a legal nullity.
“It is noted by the board with extreme concern that a Gazetted Notice was published on Friday 12 May 2023 to the effect that corporate rescue proceedings had validly commenced. This is not accurate or true,” he said.
“Telecel Zimbabwe (Pvt) Ltd wish to assure the public, stakeholders, creditors, and all interested Telecel persons that it continues to provide its services as normal.
“An invalid legal process by the Communication and Allied Workers Union of Zimbabwe was lodged in the High Court of Zimbabwe under HC 306/22 in October 2022 through Gumbo & Associates.
“That application was opposed. The outcome of those proceedings awaits a set down date to determine the validity and the merits,” he said.
“The notice as published in the Gazette is considered a legal nullity. The belated notice tries to sanitise procedural defects raised in opposition by our lawyers Honey and Blanckenberg.”
In his application filed at the High Court, Mr David Mhambare, the union’s secretary-general, said the firm was insolvent and faced liquidation if no rescue action was immediately taken.
Mr Knowledge Hofisi of Aurifin Capital was then nominated to be the corporate rescue manager. Reads part of the Government Gazette notice: “Notice is hereby given to the shareholders, employees and other creditors of Telecel Zimbabwe (Private) Limited that a Court application for the placement of the above-mentioned company under supervision was filed with the High Court of Zimbabwe (Commercial Division), Harare, on the 10th of October, 2022 under Case H.C. 306/22.
“It follows, therefore, that Corporate Rescue proceedings have commenced in terms of section 124(2)(b) of the Insolvency Act [Chapter 6:07].
“In terms of section 125(1)(b) of the Insolvency Act [Chapter 6:07) corporate rescue proceedings are deemed to begin when an affected person applies to the Court for an order placing the company under supervision in terms of section 124(1) of the said Insolvency Act,” reads part of the notice.
Dr Makamba said all interested stakeholders, including the public, our customers, and creditors are assured that there is no valid basis to assert that Telecel is unable to discharge payments of any valid debt or is incapable of discharging its service provisions to the public, beyond the normal constraints exerted by the current tough operating environment.
To that end, he said the board and stakeholders of Telecel shall continue providing its services professionally and are currently seized with advanced plans to inject fresh capital into the organisation as it enters a new “exciting” phase of sustainable growth.
Telecel is 60 percent owned by Telecel International, a wholly owned State entity, while 40 percent is owned by Empowerment Corporation (EC), a consortium of indigenous individuals and business groups.
Dr Makamba and Dr Jane Mutasa are major shareholders in EC. Apart from Dr Makamba and Dr Mutasa, some individuals and business groupings claiming to be shareholders, including businessman Dr Phillip Chiyangwa, Zimbabwe Farmers Union, National Miners Association, Indigenous Business Women Organisation and Magamba eChimurenga.
Mr Leo Mugabe and Mr Patrick Zhuwao, nephews of the late former President of Zimbabwe, Robert Mugabe, are also among prominent figures who were once declared legitimate shareholders in Telecel Zimbabwe.