adminUntil the last creditors’ meeting held at the High Court about a month ago, about US$12 million had been claimed by various creditors of the company.
The majority of the creditors had voted for the placement of the company under final judicial management.
While details of why DWTL guaranteed the loan advanced to FSI Agricom could not be ascertained, it is understood that the two companies had a relationship in which the former was one of the major suppliers of cotton lint to the latter.
Agribank legal services manager, a Ms Mutanga, wrote to Mr Wensley Militala, the DW provisional judicial manager, last week advising him of the claim.
“We write to advise that the bank availed a loan facility to FSI Agricom Cotton (Private) Limited to the tune of US$5,8 million on two differing dates, being June 30, 2010 and the 16th March 16, 2011,” she said.
“In pursuit of the loan advanced to the aforementioned company, David Whitehead Textiles Limited facilitated security perfection in favour of the bank. In this regard, in terms of Section 35(2) of the Agricultural Finance Act (Chapter 18:02) a Note of Hand (Mortgage Bond) was duly registered over the above-mentioned company’s (David Whitehead) immovable property.
“Put differently, by way of a resolution of the board of directors of David Whitehead Limited dated June 11, 2010, the said company resolved that a Note of Hand be passed over a certain place situated in the district of Gwelo being Stand 1900 Gwelo Township of Stand 1882 Gwelo Township measuring 1 6075 hectares, held under deed of transfer Number 3202/73 dated October 5, 1973.
“It has come to our attention through the Press, that David Whitehead Textiles Limited has been placed under financial judicial management by way of the majority vote of creditors. The bank at this stage does not seek to foreclose the aforementioned company’s immovable property.
“In the circumstances, we kindly request that your good offices notes our interest in this matter. In addition, the bank seeks that you provide us with written confirmation as to our ranking as creditor given the precarious financial situation that David Whitehead Textiles Limited finds itself in.”
The High Court had appointed Mr Knowledge Hofisi as the final judicial manager of the company before the same court overturned the decision, after an appeal by Mr Militala.
Mr Militala filed an urgent chamber application challenging the appointment of Mr Hofisi, arguing some of the creditors and companies under DWTL were not served with papers confirming the placement of the company under final judicial management.
Efforts to get a comment from Agribank chief executive Mr Sam Malaba were unsuccessful. No comment could also be obtained from FSI Agricom.
Online Reporter