THE Government says it is working on enhancing the “proper value” of CAPS Pharmaceuticals before offloading its shareholding to private investors.
The Government, through the Reserve Bank’s Zimbabwe Asset Management Company took over the majority stake of the country’s largest drug manufacturer after paying off its debts and previous shareholders.
ZAMCO, a special purpose vehicles created to hive off non-performing loans that were threatening the stability of the financial sector, has so far injected $130 million to rescue debt ridden local entities.
Some of the local companies that have been rescued include by Zamco include The Cotton Company of Zimbabwe ($38 million), RioZim ($32 million and Cairns ($6 million.
“There is no way the Government would want to be the shareholder in the company for good,” Industry and Commerce Minister Dr Mike Bimha said in an interview.
“We are working on reorganising and restructuring the company to enhance its proper value; restore its value before selling it to private shareholders,” said Dr Bimha.
In 2013, CAPS ceased operations and its buildings in Southerton were once auctioned for $1,5 million.
The auction was, however, reversed after the High Court ordered that the sale of the premises should be done through a private treaty. Government was also reported not to be happy with the business that was likely to be conducted by the winning bidder.
Previous anchor shareholder Mr Freddy Mtanda blamed the then Reserve Bank governor Dr Gideon Gono for the collapse of the company after ordering delivery of all stocks of medicines in 2009 to State hospitals and promised to provide forex to replenish stocks.
However, the promised foreign currency never materialised and CAPS was paid Zimbabwean dollars. CAPS used to manufacture about 75 percent of the country’s essential drugs.