DELISTED manufacturing firm Cairns Holdings is expected to ramp up production by the first quarter of next year as existing shareholders give way for new investors following its recapitalisation, the company’s judicial manager has said.
Speaking on the sidelines of a workshop held in the capital recently, Cairns Holdings judicial manager Reggie Saruchera, said the company has agreed to settle labour disputes outside the courts which made it possible for the firm to retain all the staff members. This, he said, was expected to improve the handover-takeover of the firm.
“We are looking at February next year to have all things sorted out. Every worker at Cairns is back at work as we speak,” he said.
Saruchera said the company was operating at between 35% -40% of installed capacity and currently producing snacks, groceries, biscuits, cornflakes and peanut butter, adding that the winery was also operational.
“The indigenisation issues have been approved by government. We are still expecting our equipment that we purchased with the $1 million we received from the Distressed Industries and Marginalised Areas Fund (Dimaf) by the end of this month,” he said.
“Shareholders usually come back when things start working and sometimes they hold on to the company when they do not have money to invest so the problem is when do you draw the line.”
Under the country’s indigenisation and empowerment laws, foreign-owned companies should sell 51% stakes to locals.
Vasari will take a 67% stake in Cairns that was disposed of by the Reserve Bank of Zimbabwe after the shareholders and creditors agreed to bring in a new investor. The central bank has since the introduction of multiple currencies in 2009, stopped its involvement in quasi-fiscal activities.
Cairns applied for judicial management last year after it faced viability constraints that included lack of working capital. The company also voluntarily delisted from the Zimbabwe Stock Exchange last year.
In 2012, the company reported a $8,1 million loss for the year to August 2012. The company is currently saddled with a $11 million debt with banks being the main creditors.