eBusiness Weekly
Martin Kadzere
The Industrial Development Corporation of Zimbabwe has sold its shareholding in Stone Holdings while negotiations for disposal of some of its small to medium sized investments are at an advanced stage, Benjamin Khumalo, the general manager said.
The disposals are part of the group’s “Four D” strategy of diluting, disposing, dissolution and development of IDCZ investments approved by its board and the Zimbabwean Government.
Stone Holdings was 51 percent owned by Finstone while the IDCZ owned the remainder.
Its subsidiaries include Zimrock International, Quarrying Enterprises and Minaco.
Zimrock is involved in processing dimension stone into slabs at a polishing plant in Ruwa.
Stone Holdings owns 55 percent in Quarrying Enterprises and is involved in dimensional stone production.
Minaco is wholly owned by Stone Holdings and adds value to quarry blocks by cutting them to customer specifications for kitchen counter tops and cladding for construction industry.
IDCZ is being transformed into a fully-fledged development finance institution and the process entails restructuring of its balance to position the corporation for the DFI role.
“We have concluded the agreement for the disposal of Stone Holdings,” Khumalo said.
“Negotiations for the disposal of Allied Insurance and Zimbabwe Grain Bag are in progress. This will in a small way contribute to the capital raising initiatives.
“In some of the companies the IDCZ has had to give its partner shareholders the opportunity to exercise their right of first refusal before looking to dispose its shareholding to third parties.”
He said initiatives were in place to identify investors to partner IDCZ in some of its investments, disposal of some of the entities, dissolution of those that cannot be turned around and turnaround plans for those that are not operational but have potential.
Larger investments such as Chemplex, Sunway City, Willowvale Motor Industries and Deven Engineering would be capitalized through partnering with new investors.
“These were positioned to bring new additional capital but will also transfer new technology and skills as well as access to external markets,” Khumalo said.
He said IDCZ would retain and develop some of its investments where the corporation is a minority shareholder such as Sino-Zimbabwe Cement and Surface Investments.
Khumalo said the restructuring of the balance sheet would help IDCZ to attract lines of credit.
“Whereas in its current form the IDCZ is a conglomerate saddled with legacy debts, our goal is to create a new transformed IDCZ with an acceptable debt to equity ratio and an IDCZ whose main focus will be to promote industrialisation through development finance,” Khumalo said.
The restructuring exercise is being carried out with the assistance of the State Enterprises Restructuring Agency and financial advisors.
