adminTinashe Makichi Business Reporter
PHOENIX Consolidated Industries has started disposing of its subsidiaries to raise $10 million required to offset its debt. Phoenix is a broad-based group of industries which manufacture plastics and allied products as well as steel and allied products in Bulawayo and Harare.
The diversified group is disposing of its subsidiaries, namely William Smith and Gourock, Phoenix Brushware, Scandia Wire, JW Searcy, Precision Grinders and McMeekan.
Phoenix Industries judicial manager Mr Reggie Saruchera of Grant Thornton of Camelsa told The Herald Business yesterday that disposal of subsidiaries is currently underway and proceeds will be channelled towards offsetting the company’s debts.
“We aim to raise $10 million from the disposal of the group or its subsidiaries and as you know we have been looking for an investor to revive the company for some time now. Phoenix needs to offset its debts and the disposal of subsidiaries is the route that we are taking,” said Mr Saruchera.
“We will be publishing adverts very soon in the media with regards to the disposal of the assets.”
Phoenix is battling to remain afloat with high levels of borrowings and debt of about $5 million which the company is working hard to settle in order to create a sound balance sheet which is lucrative for investment.
The company streamlined its operations last year eyeing a return to consistent profitability but due to the prevailing economic environment the efforts have been in vain.
The streamlining strategy was introduced to turn the company’s fortunes and returning to consistent profitability.
Phoenix Industries was suspended from trading on the Zimbabwe Stock Exchange in October last year after the company had gone into judicial management.
The company is considering listing again once operations are back to full capacity.
Grant Thornton Camelsa advisory manager Mr Busisa Mbano told The Herald Business in November last year that there is scope in saving Phoenix considering its potential to generate income to repay creditors once enough recapitalisation is secured.
He said no investors have been secured yet for the group and the judicial manager is implementing strategies to revive operations.
Apex Pension Fund is Phoenix’s major shareholder with a 46 percent stake.
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