The wrangle over the estate of the late cabinet minister Eddison Mudadirwa Zvobgo’s continues with the minority shareholders demanding an immediate shareholders meeting for the purposes of empowering one of the shareholders to prosecute any member of the estate who is exposed of abusing assets by a forensic audit.
This comes after the minority shareholders who are Zvobgo’s children, Jonas and Esther were awarded a favorable High Court order for the estates business to conduct the forensic audit.
The administrator of the estate Eddison Zvobgo Jnr and his uncle Professor Rungano Zvobgo have been accused of abusing the estate funds and assets for their gain leaving out other siblings.
In the letter to Eddison and Rungano Zvobgo’s lawyers delivered on November 30, the minority shareholders are demanding an urgent meeting saying the meeting will tackle issues authorizing criminal prosecution of those found to have abused the assets of the Estate.
“We still act for the minority shareholders in the above cited matter which was heard and determined on 27” November 2023.
“We are instructed to demand that, in light of this development, your clients Eddison Mudiwa Zvobgo and Rungano Zvobgo immediately and urgently call a shareholders’ meeting which they have thus far avoided calling in terms of the resolution of 13” May 2022.
“We are instructed to advise that the minority shareholders wish to discuss and possibly urgently secure resolutions; a. Authorizing criminal prosecutions against any and all persons found to have committed any offence against the assets of the business,” the lawyers for minority Jiti Law Chambers wrote.
They submit that the meeting will be to empower, authorizing and appointing one among them (the minority shareholders) to represent the company in any such proceedings.
“We therefore demand as we are instructed to, that your clients Eddison Zvobgo and or Rungano Zvobgo call a shareholders meeting on or before 31 December 2023, failure which we are instructed to seek urgent relief to fulfill the shareholder wishes,” they warned.
On November 27, Commercial Court of the High Court judge Justice Jacob Manzunzu ordered the forensic audit into Zvobgo’s Estate after the minority sought the court to order a forensic audit saying they are losing without any compensation.
They had also argued that Eddison Zvobgo Jnr as the managing director of the estate is failing to pay taxes which exposes the company assets to attachment and execution saying no reasonable explanation has ever been furnished to the shareholders who are the owners of the property at risk.
ln their application the duo cited Eddison Zvobgo Jnr, Rungano Zvobgo, Zvobgo Holdings Private Limited, Kerina Makaita Zvobgo and Tsungirirayi Zvobgo as the first to fifth respondents respectively.
Eddison Zvobgo jnr is the managing director of the Zvobgo empire that consists of several companies that include;
Perce (Private) Limited T/A Flamboyant Hotel
Nyuni Farm (Private) Limited
Chevron Hotel! Private Limited
Zvobgo Investments (Private) Limited
LesDiz Properties (Private) Limited
Nuvuzeze Property & investments (Private) Limited
Sunrise Holdings (1990) (Private) Limited
and Fairmile Motel New Corporate investment (Seven) (Private) Limited.
The applicants had submitted their application for their protection as they are the minority shareholders in Zvobgo Holdings saying Rungano and Eddison have jointly conducted themselves in a manner that is grossly oppressive and prejudicial to their interests.
They argued that Rungano and Eddison have been repeatedly using the majority vote to conceal their refusal to account for the company assets or financial health of the company saying the two respondents have failed to safeguard company assets from other employees.
They further accused Rungano and Eddison of sourcing loans from various financial institutions and failed to account for the said loans saying this disregard has exposed all shareholders and company assets to forfeiture by creditors.
“Eddison and Rungano have authorized or condoned Iittigation in the name of the company/companies without approvals or knowledge of the other shareholders. When confronted to account for the decisions Eddison deployed the use of violence against one of the beneficiary of the estate.”
In the affidavit filed Jonas submitted that sometime in 2022 he learnt that Eddison approached CBZ Bank to borrow US2 million without a board resolution authorizing them and without the knowledge of the shareholders.
They said his permanent and continuing occupation of one of the presidential suites at one of the company’s hotels the Flamboyant Hotel in Masvingo at a cost of over One Hundred United States Dollars (USD100.00) per night.
They argued that Eddison has occupied the position for 20 years saying this is enough to point to the oppressive decisions and the abuse of housing allowance demonstrate how much shareholders are losing.
