adminThe company was recently placed under judicial management due to operational constraints and non-payment of debt by some of its debtors.
Speaking by telephone from Harare yesterday, one of the new investors, Mr Sakiwe Ndhlovu, said the money was sourced locally and through offshore funding.
“We have secured $300 000 locally and through offshore funding. The capital is meant for the procurement of raw materials, meeting day-to-day overheads expenses as well as ceding 10 percent shares into the employee share ownership scheme in line with the Indigenisation and Economic Empowerment policy,” he said.
However, contacted for comment, business advisor Dr Eric Bloch said negotiations for funding were still on-going.
“Negotiations with possible financiers have not yet been finalised. It (company) requires few millions of dollars to fully revitalise operations,” said Dr Bloch.
Mr Ndhlovu said the company was operating at between 10 percent and 15 percent capacity utilisation.
Following the capital injection, capacity utilisation at Security Mills is expected to improve within the next few months.
“At the moment, Security Mills is operating at very low capacity. The $300 000 capital injection will see us immediately increasing production to between 35 percent and 40 percent,” he said.
The company has a workforce of 190 people and it was envisaged that as production rose in the next few months, 350 people including former employees would have secured employment at the textile firm.
“It is our hope that eventually we will employ 1 500 people,” he said.
Zimbabwe’s textile and clothing sector was not spared the economic turmoil the country went through in the past decade.
Companies have faced a number of operational challenges leading to some to liquidate while others, in a bid to stay afloat, reduced their workforce.
The textile industry has bemoaned unfair competition posed by smuggled imports, high salaries demanded by workers, saying they were higher than those paid by their counterparts in Sadc.
Online Reporter