Meikles unfazed by property auction

HARARE - Meikles Limited (Meikles) has taken legal overtures in relation to a recent auction of its assets valued at about $1,5 million by a creditor.

Thabani Mpofu, Meikles’ company secretary, yesterday said Core Solutions last December auctioned off assets relating to Meikles’ investments in Tanganda Tea Company and Meikles Hospitality.

“Core Solutions proceeded to auction certain assets of the group on December 24, 2018… This auction is being contested in the Supreme Court, the outcome of which is pending.

“The attachment and subsequent auctioning of the assets was as a result of a heavily contested arbitral award of $1,5 million to Core Solutions,” he said.

In addition, Meikles is also contesting the arbitral award in the High Court, with the appeal’s ruling also pending.

“The Meikles Board has put other measures in place to ensure company assets are safe and shareholder value is protected,” the Meikles company secretary said.

The auction — conducted by LM Auctioneers — saw Murray Lynton-Edwards being declared the highest bidder, purchasing both assets for approximately $2,7 million.

This comes as the listed conglomerate contracted Core Solutions to help recover the money raided by the Reserve Bank of Zimbabwe (RBZ) from its accounts.

According to court papers, Mpofu, on behalf of Meikles, argues that the sale price of the assets was more than the amount required to satisfy the debt, and that the auctioned assets were not valuated prior to the sale.

“It is interesting to point out at this stage that if one is to read between the lines, the intention of the auctioneers and the first respondent was to conduct a public auction as if it was a private treaty, as the creditors’ own people were to bid for the shares had it not been for the presence of the second respondent.

“This was clearly an attempt at fraudulently disposing the shares and changing the shareholding as aforementioned. This was clearly an attempt at committing a criminal offence, something which the applicant shall follow up with the Zimbabwe Republic Police Fraud Squad for the charge of attempted fraud in terms of the Criminal Law (Codification and Reform) Act,” the court papers said.

Meanwhile, Meikles recorded a profit of $8,1 million in the year to March 2018, as revenue grew from $457,6 million to $534,9 million driven by the supermarket unit which posted a 45 percent EBIDTA surge to $34,5 million.

However, John Moxon, Meikles’ chairperson is on record saying the preliminary set of unaudited results did not include the funds government owes the group, but another set of the financials were to be released.

Trading in 55 stores, the segment will see the opening of other stores in the 2019 financial year along with upgrades to existing stores.

With EBITDA rising to $10,3 million from $6,1 million, Meikles’ agriculture unit anticipates a better yield once avocado and macadamia plantations reach maturity in the future.

Hospitality EBITDA grew from $1,8 million to $4,1 million.

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