Van Hoogstraten flexes muscles at CFI
Controversial businessman Nicholas van Hoogstraten has flexed his muscles at CFI Holdings (CFI) following the appointment of his blue-eyed boys Timothy Nyika and Shingirai Chibanguza as acting chief executive and deputy chief executive respectively.
The duo’s appointment effective this week comes as CFI’s long-serving chief executive Stephen Kuipa has been shown the exit door.
People knowledgeable about boardroom squabbles at CFI said Kuipa’s departure, together with chairman Simplicius Chihambakwe and board member Patricia Bwerinofa, was necessitated by a nasty fallout with Van Hoogstraten, who this week called for a forensic audit into the company’s operations.
The British tycoon’s family trust, Messina Investments controls a 34 percent shareholding in the troubled diversified firm, which was suspended from the Zimbabwe Stock Exchange for failing to publish financials for the year ended September 30, 2015.
“Van Hoog is not happy with the continued mismanagement of the company he feels has capacity to perform exceptionally well. That is why he has called for a forensic audit to be conducted on the company dating back to six years ago,” said the source.
CFI is currently working on scheme of arrangement aimed at recapitalising the group through the disposal of non-core assets.
In a letter addressed to creditors, CFI said it planned to dispose assets valued at over $19 million to settle its legacy debts.
“The board believes that a scheme of arrangement with the group’s creditors is now the missing link to completing the full turnaround. The shareholders are requesting for your support to afford the business a stay of execution and litigation,” read part of the letter dated November 27, 2015.
The sources, however, say van Hoogstraten was frustrated by the previous board’s antics to buy time while the company continued to lose its net value hence the decision to fire the management.
CFI has since dollarisation experienced significant financial strain largely caused by expensive borrowings, impact of ageing equipment and infrastructure on efficiencies and overheads which are not adequately aligned to the low capacity utilisation.
The diversified group last year sought to raise $20 million through rights issue in an effort to resolve capitalisation challenges across its strategic business units.
The group also disposed of Langford Estate to Fidelity Life in an effort to clean the balance sheet through the extinguishment of $16 million debt.
But, CFI acting chairperson Grace Muradzikwa tried to play down the dismissal of the board saying Chihambakwe resigned “to focus on his private practice”.
“…Kuipa is proceeding on leave pending his retirement on April 30, 2016. The board wishes to register its appreciation for his role in leading the group up to the point of his retirement,” she said in a statement yesterday.
CFI’s operating units span from Agrifoods and Agrimix — with chick producers, Hubbard Zimbabwe, SunCrest and Crest Breeders all being part of the group. Daily News
