Home » Legal and Judicial Affairs » COOKING OIL MANUFACTURER EYEING TAKEOVER OF STATE-OWNED COTTON COMPANY OF ZIMABABWE

HARARE-- A cooking oil manufacturer, SurfaceWilmar, is eyeing the takeover of the State-owned Cotton Company of Zimbabwe (Cottco) as part of a raft of strategies which the company is pushing the government to adopt as part of measures to revamp the cotton industry, a company executive says.

SurfaceWilmar chief executive officer Slyvester Mangani told the Parliamentary Portfolio Committee on Lands, Agriculture and Resettlement here Tuesday that SurfaceWilmar had submitted its preliminary takeover proposal to the government.

Executives at the cooking oil refiner are convinced they will be able to address current inefficiencies which have seen the government failing to recoup its investment Cottco.

Our proposal was to get the management contract of Cottco through shareholding. The reason we have asked for management control is we have got the vision of what we want to do and this will be the best means of getting that vision executed. Our involvement can only come if we can execute the vision that we have for this company, Mangani told the committee.

We are expecting to be shareholders in Cottco but with management control. Our idea is to increase production of cotton which then benefits all our other companies.

Cottco's cotton production has slumped over the years forcing the government to intervene in production of the crop referred to as the "white gold" at its peak. In the previous season, the government invested more than 40 million US dollars in inputs which were distributed free to small-scale growers, with the amount increased to 60 million this past season.

It is expected the investment will result in a rise in production to more than 130,000 tonnes from 75,000 tons last year.

Cooking oil producers like SurfaceWilmar require cotton seed, which has over the years been in short supply.

In the past season, the company contracted Cottco to provide 50,000 tons of the seed but could only obtain 9,600 tons.

SurfaceWilmar Executive Chairman Narottam Somani said it would be easier for the company to take over and resuscitate a company with existing infrastructure instead of setting up fresh operations. Creating a new infrastructure in a country where there is no cotton crop will not be a judicious decision, Somani said when asked why SurfaceWilmar wanted to takeover Cottco instead of setting up new operations.

He said it was easy to turnaround a company with existing infrastructure such as ginneries and extension services.

Mangani said the cotton was still waiting for a response from the government after which the necessary steps would be taken if the takeover was given the green light. The government took over Cottco Holdings over a year ago as the company, then in private hands, was struggling and was on the brink of collapse.

SurfaceWilmar is still basking in the glory of having managed to rescue Olivine Holdings, a diversified fast moving goods producer, from collapse.

Source: NAM NEWS NETWORK

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