Chronicle Editor
Oliver Kazunga, Senior Business Reporter
DEFUNCT tyre manufacturer, Auto Tyres Zimbabwe, has started the process of paying out ZWL$4,1 million it owes creditors and former workers.
Formerly Dunlop Zimbabwe, the country’s sole tyre manufacturer ceased production in 2016 citing working capital and foreign currency constraints to procure critical raw materials. In June 2018, the company was said to be in need of about US$12 million working capital to resume operations.
Responding to questions from Business Chronicle, the company’s judicial manager, Mr Shepherd Chimutanda, said payment of former workers and creditors was expected to begin as soon as the Scheme of Arrangement was registered with the Registrar of Companies, a process already underway.
“According to the approved Scheme of Arrangement, ATZ owes creditors and former workers ZWL$4 133 922. As soon as the scheme is registered with the Registrar of Companies, which is in progress, payment of creditors and former workers will begin,” he said.
Recently, ATZ issued a public notice inviting the company’s creditors and former workers to submit their banking details. Asked whether ATZ would re-open or face liquidation, Mr Chimutanda said: “It will re-open subject to availability of foreign currency and in the event we decide to re-open, we have targeted January 2021.”
The company in 2017 acquired modern tyre-making equipment meant to enhance competitive production once operations resume. An indigenous company, Zoomway (Pvt) Limited acquired 51 percent shareholding in Auto Tyres Zimbabwe in April 2016. Previously, the local tyre producer was a subsidiary of Apollo Tyres.
At its peak, Dunlop Zimbabwe used to employ up to 2 000 people directly with significant impact downstream along the value chain. Before its closure, Dunlop used to export to countries such as Zambia and South Africa. Zimbabwe now relies on imported tyres which is contributing to the high import bill. — @okazunga.
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