Botswana firm to revive Marvo

Dumisani Nsingo, Senior Business Reporter
THE one-time stationery manufacturing giant, Marvo Stationery is set to get a lifeline after entering into a partnership with a leading Botswana company, Lexus which will inject more than $150 000 to revive production at the Bulawayo firm.

Marvo Stationery was placed under judicial management in September 2014 as it struggled to settle a debt of about $2,5 million accrued after failing to pay its creditors and a huge wage bill backlog.

Marvo Stationery Manufacturers judicial manager Mr Crispen Mwete of C Mwete and Company said the company has been scouting for financiers to partner the stationery manufacturer to resume operations since it closed shop over two years ago due to lack of working capital.

“We started looking for investors two years ago and we had a South African firm which came and showed interest but the deal fell through before anything concrete could be reached. We are now dealing with a Botswana firm and there is also another local investor who has shown interest,” Mr Mwete said.

Lexus Stationery is one of the biggest stationery retail outlets based in Francistown, Botswana.

He said luring investors to inject capital into Marvo Stationery Manufacturers was a big task since most of them were sceptical about the prospects of recouping their investment in the event of taking over the debt.

“The deal with the Botswana company is such that it will supply the raw materials and we manufacture the stationery and sell and in turn the investor intends to have part of their payment in cash or goods and as such I have since written to the Zimbabwe Revenue Authority to find out whether such an arrangement is feasible,” Mr Mwete said.

He said the Botswana firm has already secured a credit facility for the purchase of 90 tonnes of newsprint and 30 tonnes of bond paper and hard paper covers at a cost of $132 000 with the company further pledging to inject an additional $18 000 as working capital to resume operations.

“We were hoping to start production this month as everything appeared to be in place but we are now waiting for the investor to complete its final due-diligence process which we expect to be finalised soon, thereafter we are going to resume operations.

“Our new potential investor is excited about the deal because Marvo has been a reputable international brand over the years which can be easily marketed across the region and to show its commitment it has already secured a credit facility from a financial institution there in Botswana,” Mr Mwete said.

He said if the deal with the Botswana firm was to come to fruition, the stationery manufacturer was likely to be on its feet though it would face stiff competition from imports.

“The machinery is there though old but of course it is still useable. As an entity if we get the raw materials at the right price we can’t go wrong. The only problem we might face is of influx of imported stationery and that will definitely affect us because those imports are likely to be cheaper than our products largely due to the fact that our production costs are on the high side,” Mr Mwete said.

Contacted for a comment, Lexus Stationery managing director Mr Munyaradzi Marufu confirmed the company’s interest in investing in Marvo Stationery Manufacturers but could not be drawn to divulge more information pertaining to the deal.

“We have had talks with the Marvo management (judicial), we are still yet to finalise our position. They have presented a few options which we are working on, by the end of this month we will be in a position to state our position and terms. But the talks we have had were fruitful,” he said.

Booksellers Association of Zimbabwe national chairman Mr Paul Masuku said the reopening of Marvo Stationery Manufacturers would be a welcome development as booksellers are assured of purchasing stationery at a cheaper price and selling it at a reasonable value to consumers.

“The resumption of production at Marvo will be a welcome development because we will be assured of buying stationery at a wholesale price and that will be better than forking out 40 percent in duty for the importation of the printed material mostly from South Africa,” he said.

Marvo Stationery Manufacturers was established in 1966 and at its peak it used to employ more than 500 workers.

Today its workforce stands at 200.