BOTSWANA-based supermarket, Choppies, has threatened to
revoke shares it gave to former Vice-President Phelekezela Mphoko and his son,
Siqokoqela, as part of a scam to allow the retailer to comply with the
country’s indigenisation laws that required locals to control a 51% stake in
foreign-owned businesses.
Botswana-based Choppies Enterprise chief executive officer
Ramachandran Ottapathu said in a letter to the Press that the Mphoko family
were given 51% of the shareholding “on paper”, to meet existing empowerment
laws, but their actual shareholding was 7%.
The ongoing ownership wrangle has exposed the fraudulent
activities engaged in by the partners to circumvent the country’s indigenous
laws.
“Mphokos were given the 51% shares in an agreement which
allows us to buy back the shares as and whenever we want, as part of efforts to
comply with the law. We gave them the shares on paper. Their 7% free carry
shares was a way of thanking them for facilitating that we set up business in
Zimbabwe,” Ottapathu said.
The agreement allowed Choppies to withdraw the 44%
shareholding allotted to them at any time the retailer wanted, while the other
7% shares could be bought back at $1 per share.
“The other 44% shares were allotted to them (the Mphokos)
to add to the 7% free carry shares to make it 51%. According to the shareholder
agreement that was signed to facilitate the setting up of the business under
Zimbabwean law at the time, the 44% shares can be called back at any minute at
no cost to Choppies Enterprises, thus leaving Mphokos with their 7% share.
“The 7% free carry shares can be bought back by Choppies
Enterprises at US$1 per share in the event that we want Mphokos out of the
business altogether.”
Ottapathu said the Mphokos have been getting dividends
equal to the 7% shareholding they hold and not the 51%.
“For the record, Siqokoqela Mphoko and his father, who are
shareholders of Nanavac, have all along been getting dividends through their
bank accounts for the 7% shares they hold and not the 51%. We have proof of
transfers, and we can furnish you if you so wish.”
Ottapathu said he had documentation to prove that the
Mphoko family never invested any money into the setting up of the business in
Zimbabwe, but the Botswana partners are the ones who brought in $25 million
from Barclays Bank of Botswana, for the setting up of Choppies operations in
Zimbabwe.
In the letter, Ottapathu is accusing sections of the media
of portraying them as trying to wrestle Choppies Zimbabwe from Mphoko and his
family. Newsday
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