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Fidelis Munyoro : Chief Court Reporter
KINGSTON’S Holdings Limited has secured funding to revive its ailing business and pay off all its creditors, The Herald has learnt.The company was reeling under a severe liquidity crunch and plagued with lawsuits from creditors seeking to recover their money running into millions of dollars. This week the company was placed under provisional liquidation following a successful application by one of the creditors, Alshams Global BVI Limited in the High Court.Justice November Mtshiya placed the company under provisional liquidation in a case in which the company strenuously argued that it had secured funding and that it had assets under its subsidiary company, Kingstons Properties.
The judge ruled that in the absence of assets or evidence of viability of the holding company he had no choice, but to place it under provisional liquidation.
The matter is expected back in the High Court on October 10. A reliable source told The Herald yesterday that the company has secured enough funding and is expected to pay off its debts.
“We have engaged the creditor (Alshams) with a view to settle our debt with them. We are still to get their response,” said the source.
“They can now go and lodge their claim with the Sheriff and get payment.”
A company is placed under liquidation when it is unable to pay its debts. This is done voluntarily or by a court order.
A liquidator is appointed to investigate the company’s financial affairs, establish the reason why the company failed, investigate possible offences and identify and sell assets to help repay creditors.
Alshams Global BVI Limited was among the creditors that were struggling to recover their debts from Kingston’s.
Through its lawyer, Advocate Lewis Uriri, instructed by Mr Innocent Chagonda of Atherstone and Cook, Alshams sought an order placing the company under provisional liquidation in terms of section 207 of the Companies Act (Chapter 24:03) on the basis that it had failed to pay its debts.
Kingston’s core business is selling books, magazines, newspapers and a variety of educational and other forms of stationery. It used to dominate the market through a network of countrywide branches.
Kingston’s faced financial challenges at a time when it started diversifying its operations towards the information and technology sector to make itself relevant in a fast changing market —including going into broadcasting.
Among other Kingstons’ creditors is the Zimbabwe Revenue Authority, Old Mutual Zimbabwe and the National Social Security Authority. The company, used to have many branches countrywide, but these were closed owing to lack of funding.
Online Reporter