Glory days gone by?

via Glory days gone by? – DailyNews Live 6 July 2014 by Kudzai Chawafambira

HARARE – Zimbabwe’s economic woes have not spared once thriving businessmen’s empires, leaving the owners saddled with a low profile.

From glory to sorry, a lot of these empires have crumbled like the proverbial deck of cards.

At the forefront of supporting the government backed indigenisation policy which was initially meant to promote the development of black-owned businesses, Ben Mucheche stood above the rest of the business elite during Zimbabwe’s first two decades of independence.

Once the envy of many, a transport operator for his large fleet of buses, Mucheche’s MB Luxury Coaches, is now singing the blues.

The sun has set for his once thriving bus company and his absence from hogging the limelight has left many wondering what could have gone wrong.

Although most rural bus operators of yesteryear no doubt left an indelible mark in the transport sector,  a few still remain in operation.

During the 1990s, roads were awash with buses from Chawasarira, Tenda, Kukurwa Kurerwa, Musasiwa, B and C, Chigubhu, Mhunga and Mhiripiri, just to name a few.

These buses were found in every corner of the country servicing routes of their preferred destination. But because of the economic decline experienced since the turn of the millennium, most transport operators shut down.

Apart from Mucheche, who was once the president of the Zimbabwe Rural Transport Operators (ZRTO), most owners of the bus services seem to also have gone on a low profile.
Enter Chemist Siziba.

Once a service provider to government-controlled mobile network operator NetOne, Siziba’s now defunct Cosmos Cellular provided services to Zimbabwe’s growing information technology market.

When Siziba formed Cosmos Cellular in 1996, many people were of the impression that this was a business for the future.

When his business fell out of favour with NetOne due to its failure to remit funds, the entrepreneur started to literally sing for his supper to make ends meet.

Even when he tried to apply for a mobile network operator licence in 2011, Siziba’s efforts through his company Broadlands hit a brick wall.

The Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) reportedly argued that they did not see why individuals would invest in mobile network equipment when they had not been issued with an operating licence.

Siziba’s potential has since fizzled out and according to recent media reports, all is not well for the once promising telecommunications guru.

When Tawanda Nyambirai’s then TN Holdings brand hit the Zimbabwean market by storm, a few were sceptical about the businesses being able to weather Zimbabwe’s economic downturn, while many were caught in awe at what seemed like an ideal model of a diversified business approach.

From banking to roasted chicken and potato fries, furniture business to retailing, cattle banking to medical insurance services, among other business activities, Nyambirai once said his empire would not collapse as he was working hard to realign his remaining businesses to the prevailing economic conditions.

Renamed to Lifestyle Holdings, Nyambirai disposed of then banking arm TN Bank (now Steward Bank) to Econet following the acquisition of a controlling stake by the telecommunications giant in the bank last year in January in a cash and share swap deal.

The Harare businessman has taken great exception to negative reports that the business empire he toiled to build was crumbling, pointing out the reports are baffling as the group is simply right-sizing as everybody else is doing.

However, as things stand, the group after delisting last year embarked on a massive downsizing exercise shutting down four outlets in Harare.

TN Mart, its retail line reportedly closed branches in Glen Norah, Willowvale, Warren Park and Kuwadzana due to a lukewarm market response.

This has blighted the group’s prospects of rolling out more branches by year-end as indications point to the demise of business.

Hard times have indeed fallen on Nyambirai’s business empire. He, however, still holds a modest stake in Econet but this is not reflecting the dream he wished to achieve in his life.

Once prominent banker Nigel Chanakira might not have taken the fall when he sold his stake in then Kingdom Financial Holdings Limited, now AfrAsia Zimbabwe Holdings Limited (AZHL).

But his profile as one of the pioneer black bankers remains etched in the minds of Zimbabweans.

Recent reports indicate that Chanakira says he decided to leave the bank because it is no longer excelling.

Crustmoon, an investment vehicle linked to Chanakira agreed to dispose of its 30 percent stake in AKZL.  AKZL are AfrAsia Kingdom Bank’s parent company.

However some quarters in the market say Chanakira failed to take control of his empire and sold his stake for $12,5 million after falling on hard times.

The amount was made up of $2,5 million in cash and $10 million in non-performing loans.

Having started Kingdom with Z$120 000 about 19 years ago, it is widely believed that he was muscled out of the bank project.

Market watchers had for a long time speculated that Chanakira would be forced out of the group after AfrAsia Kingdom Bank was forced to write off a $20 million non-performing loan extended to Zach Wazara’s Spiritage Zimbabwe Limited (Spiritage),

However, the Kingdom merger with John Moxon’s Meikles Africa in 2007 proved to be Chanakira’s biggest undoing.

This was after Chanakira resigned as chief executive of Kingdom Meikles in 2009 after a fallout with Meikles chairman John Moxon.

After a vicious dispute, Chanakira, in 2011, managed to successfully de-emerge Kingdom from the Kingdom Meikles group.

Kingdom Meikles Africa Ltd (KMAL) chairman John Moxon had rejected claims by Chanakira that he was entitled to 51 percent of the company in indigenisation option rights and called the banker delusional.

A few months after KFHL merged with Meikles Africa Ltd, Moxon called for an extraordinary general meeting to have Chanakira and two other non-executive directors removed from the board.

Chanakira, sensing danger, ran to political heavyweights for protection.  Moxon backed down.

Chanakira’s story cannot be complete without the name, Zachary Wazara. Chanakira’s erstwhile friend, Wazara and his firm Spiritage is suing Afrasia Bank, formerly Kingdom Bank, for about $79 million for allegedly breaching its obligations in Valley Technologies (Private) Limited, a liquidated telecoms company which was jointly owned by the businessman and the financial institution.

However, Wazara’s business failed to blossom as a result of lack of adequate working capital.

What then boggles the mind is how the $20 million loan provided by the financial institution was considered non-performing yet the telecommunications firm was desperate for funding?

Last year in September, Potraz cancelled Valley Technologies licence for failing to meet the regulator’s requirements. The company had failed to pay its licence, spectrum and fees amounting to approximately US$2,4 million since 2010.

Valley Technologies was ordered to switch off and decommission all equipment used for the provision of services under its licence.

The Internet service provider was facing challenges and had its assets including base stations auctioned to settle funds owed to AfrAsia Kingdom Bank.

AfrAsia Kingdom Bank is believed to have entered into a debt-to-equity swap for 80 percent of Valley Technologies through the bank’s special purpose vehicle, Lalela Trading, in December 2012, after the mobile network operator failed to settle its obligations with the bank.

Wazara simply failed to run his own show.

ReNaissance Bank was part of Patterson Timba’s business empire which collapsed in 2011 under a cloud of poor corporate governance allegations.

The bank has since shut down this year.

Timba had earlier on been booted out as executive chairman of Afre in 2011 after the contagion effect of problems at his then ReNaissance Merchant Bank spread to the financial services group.

He was then accused of abusing policyholders’ funds. Timba was eventually kicked out of the board in 2012.

He has since been hiding from the public glare, but should have been one of the business leaders leading from the front to take the country’s economy forward.

From running fast growing businesses in the country, flying around the world and having a place at the high table to rubbing shoulders with ordinary men on the street, life indeed goes full circle.