‘Comply and we inject $18m’ – NSSA tell CSC

Source: ‘Comply and we inject $18m’ – NSSA tell CSC | The Financial Gazette July 13, 2017

THE National Social Security Authority (NSSA) says it was ready to inject $18 million into Cold Storage Company (CSC) to revive its operations once criteria for its investment were met.

In May this year, NSSA refused to inject new money into the troubled CSC until a 12-member board appointed by government the previous month had been dissolved. NSSA intends to inject US$18 million of pensioners’ money into the parastatal to pull it back from the brink of collapse.

CSC has been reduced to a shell through years of unchecked mismanagement and asset stripping and hence requires nothing short of a competent board and management team to revive it.
It also requires a huge bailout to set it on a recovery path and retire expensive debt.
But that capital injection might hit a snag because the pay-as-you-go NSSA pension scheme does not have the confidence in the newly-appointed CSC board.
“NSSA is in support of an equity investment into CSC and the recapitalisation program for this strategic national asset once the criteria for our investment is met. The proposed schemes of arrangement are yet to be registered with the High Court due to an opposing challenge which was filed by a former CSC employee,” said NSSA board chairman Robin Vela in the institutional investor’s second quarter review.

In an earlier interview with The Financial Gazette, Vela, said the authority would only pump in new money into CSC once the current board has been dissolved and a new, inspiring line-up put in its place.

The authority is not convinced that the newly-appointed board has what it takes to turnaround the parastatal, in which government is the sole shareholder.
The board, appointed by Agriculture, Mechanisation and Irrigation Development Minister, Joseph Made, has Sylvia Khumalo-Jiyane as chairperson. Khumalo-Jiyane is deputised by Nemrod Chiminya.
To complete the cast up are board members Emily Mumbengegwi; Anxious Masuka; Rufaro Mazunze; Khodholo Setaboli; the chief executive officer of CSC, Ngoni Chinogaramombe; Peter Nyoni; Cecilia Paradza; Bhekhithemba Nkomo and two Ministry of Agriculture representatives, Unesu Ushewokunze-Obatolu and Reston Muzamhindo. Nyoni, Paradza and Nkomo represent NSSA to the board.
The CSC board has set tongues wagging following revelations that a quarter of the appointees were related, in one way or the other, to bigwigs in President Robert Mugabe’s Cabinet.
CSC is currently operating at less than 10 percent capacity.
It owns abattoirs in Bulawayo, Masvingo, Chinhoyi and Kadoma and several ranches across the country although the majority of them are currently derelict, with only the Bulawayo unit functional.