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a substantial stake.
Sources said last week that negotiations between Jaggers and Super Group, a broad-based supply chain management business, were likely to be concluded soon.
The funds would be used to pay off creditors and to recapitalise Zimbabwe’s largest wholesale with 51 branches.
It is understood Jaggers, which is under provisional liquidation, could not be put into final liquidation after Mr Cecil Muderede, the majority shareholder in the wholesaler, revealed the latest developments.
“Mr Muderede argued that the company cannot be put into final liquidation because he had secured an investor interested in the business,” said one source.
“He indicated that Super Group of South Africa was willing to bring in fresh capital to pay off creditors and to recapitalise the business in exchange for a substantial stake.”
A lawyer, representing one of the creditors, also confirmed the latest plan but is yet to be furnished with details of the transaction.
“That is what he said (about the new investor) at the High Court meeting,” said the lawyer. “We are just waiting to see how it will go.”
Mr Muderede confirmed the development but could not give more details citing confidentiality.
“It is true that we have engaged an investor from South Africa and we should be finalising the deal in the next two weeks,” he said.
“However, the matter is so sensitive and I cannot provide you with more details at the moment since we are dealing with a listed company.”
Jaggers provisional liquidator Mr Regis Saruchera could not be reached for comment by the time of going to press.
The search for a strategic partner by the shareholders of Jaggers is not unusual considering that the company was placed under provisional liquidation.
A provisional (liquidation) order is a temporary order which, ordinarily, would be subject to confirmation or alteration.
If the provisional liquidation order is altered the company can even be placed under judicial management, for example Merspin or G & D Shoes in Bulawayo.
However, the appointment of a final liquidator implies attainment of finality and closure and therefore it may be difficult to resuscitate a company from the ashes of a final liquidation process.
Mr Muderede acquired Jaggers from Metcash of South Africa for US$7,2 million but investigations by Herald Business revealed that when the two entered into an agreement, significant amounts of Jaggers liabilities estimated to be US$10 million were not disclosed.
The level of liabilities that Jaggers had at the time of the agreement between Metcash and Mr Muderede suggests that Jaggers was already technically insolvent.
Online Reporter