Listed insurance group, Fidelity Life Assurance will proceed with its Langford Estate development as scheduled in spite of the ongoing shareholder dispute at the former land owners, CFI Holdings.
Fidelity acquired Langford from CFI Holdings in a land for debt swap deal. The insurance firm intends to develop the land into a residential suburb.
However, CFI shareholders Willoughby’s Investments Private Ltd, owned by Nicholas van Hoogstraten, have been pushing for a reversal of the Langford Estate deal alleging it was done fraudulently.
Since then, Willoughby’s has escalated its fight for an audit to take place on the Langford transaction saying that a 2015 extra-ordinary general meeting to approve the deal was misleading and dishonest in that shareholders were not told the independent property valuator of the land was prepared for FBC Bank which was also “conflicted and related party” to NSSA and Fidelity.
In addition to that a circular to shareholders did not state that Fidelity, who purchased the land was a related party as defined by the Zimbabwe Stock Exchange (ZSE).
The investment vehicle further argues that Zimre, the parent company for Fidelity and the National Social Security Authority were not permitted to vote on the sell of the piece of land in question.
However, in spite of all this, Fidelity said, the group was on course to develop the piece of land as per schedule and that they had sought legal counsel over the disputed land.
“We are proceeding with our plans to develop Langford Estates on this basis,” said Fidelity general manager marketing Melanie Gumbo by email.
Gumbo indicated development, at Langford, was progressing well with town planning and other civil engineering works underway although the prevailing economic challenges could affect the rate of execution.
“We must also take into account the current volatile economic conditions which will influence our speed of execution. Stakeholders are being kept abreast of all developments,” she said.
“We are unable to comment where shareholder issues at CFI are concerned. We have, however, sought legal counsel as FLA and wish to advise stakeholders that all conditions precedent for the transaction to be consummated were met and therefore the transaction is legal, binding and enforceable,” she said.
The other major shareholder, Stalap Investments, an investment holding company for CFI Holdings shares owned by Zimre and its affiliates is in support of the transaction.
“Stalap still supports and upholds the Langford transaction which prevented the foreclosure of CFI assets by financial institutions and other creditors to benefit all shareholders, and will continue to pursue the value preserving and accretive initiatives that will ensure long-term return on investment is attained by CFI for the benefit of all shareholders,” said Stalap in a recent statement.