Business / Local
R Chitrin applies for voluntary liquidation
09 Dec 2011 at 06:31hrs | Views
RED Star Wholesalers Limited and R Chitrin and Company Zimbabwe have applied for voluntary liquidation following serious financial constrains.
In a statement for the interim period ended September 30, 2011, parent company starafricacorporation said the necessary applications had already been filed in the High Court.
starafrica disposed of Red Star Holdings assets, following a poor performance by the wholesale subsidiary.
Upon disposal, West Foods Distribution Network acquired two branches in Harare and Bulawayo. In addition, West Foods purchased the fixed assets in the two branches and took over the employees and is using the "Red Star" brand.
The remaining assets are operating under Red Star Wholesalers, which has applied for liquidation.
R Chitrin, which has also applied for voluntary liquidation, was acquired by Red Star in 2006 as the retail company sought to consolidate its position both regionally and locally.
starafrica said plans were in the pipeline to sell Red Star Holdings listing to West Foods, who have indicated they intend to relist the business on the Zimbabwe Stock Exchange.
"Subject to fulfilment of agreed conditions precedent and the necessary regulatory approvals, plans are underway to sell the Red Star Holdings Limited listing to West Foods," said starafrica.
The company was forced to take this route after adverse trading conditions pushed Red Star into a loss-making entity.
As at March 31, 2010, the retail and distribution firm suffered a US$5,1 million loss for the year and a net liability position of US$5,3 million.
Given the net liability position, Red Star's ability to continue to operate as a going concern was contingent on starafrica providing guarantees to Red Star for the provision of short-term working capital facilities.
During the period under review, starafrica's continuing operations recorded a loss before-tax of US$2,4 million while discontinued operations posted a loss of US$906 554 after accounting for profit realised from disposals of US$2,1 million.
Discontinued operations also included Rusape Spar, which was sold to Aucyn Investments.
Starafrica also disposed of its engineering business and selected properties and the disposal process has taken longer than expected.
Proceeds of the disposal were earmarked to retire debt and as working capital.
The group is now concentrating on the sugar refinery business which produced 31 148 tonnes of white sugar in the six months to September 30, this year.
Country Choice Foods did well to post a profit before tax of US$446 598 for the six months.
The group's industrial business recorded a 33 percent growth in turnover compared with the comparable period with Blue Star Logistics posting a profit before tax of US$208 314.
The group says although Polyfilm Plastics and Highfield Bag registered a volume growth of 16 percent there was significant capacity utilisation as a result of raw material supply constraints. resulting in a loss.
The property arm posted a profit before tax of US$155 816.
In a statement for the interim period ended September 30, 2011, parent company starafricacorporation said the necessary applications had already been filed in the High Court.
starafrica disposed of Red Star Holdings assets, following a poor performance by the wholesale subsidiary.
Upon disposal, West Foods Distribution Network acquired two branches in Harare and Bulawayo. In addition, West Foods purchased the fixed assets in the two branches and took over the employees and is using the "Red Star" brand.
The remaining assets are operating under Red Star Wholesalers, which has applied for liquidation.
R Chitrin, which has also applied for voluntary liquidation, was acquired by Red Star in 2006 as the retail company sought to consolidate its position both regionally and locally.
starafrica said plans were in the pipeline to sell Red Star Holdings listing to West Foods, who have indicated they intend to relist the business on the Zimbabwe Stock Exchange.
"Subject to fulfilment of agreed conditions precedent and the necessary regulatory approvals, plans are underway to sell the Red Star Holdings Limited listing to West Foods," said starafrica.
The company was forced to take this route after adverse trading conditions pushed Red Star into a loss-making entity.
As at March 31, 2010, the retail and distribution firm suffered a US$5,1 million loss for the year and a net liability position of US$5,3 million.
Given the net liability position, Red Star's ability to continue to operate as a going concern was contingent on starafrica providing guarantees to Red Star for the provision of short-term working capital facilities.
During the period under review, starafrica's continuing operations recorded a loss before-tax of US$2,4 million while discontinued operations posted a loss of US$906 554 after accounting for profit realised from disposals of US$2,1 million.
Discontinued operations also included Rusape Spar, which was sold to Aucyn Investments.
Starafrica also disposed of its engineering business and selected properties and the disposal process has taken longer than expected.
Proceeds of the disposal were earmarked to retire debt and as working capital.
The group is now concentrating on the sugar refinery business which produced 31 148 tonnes of white sugar in the six months to September 30, this year.
Country Choice Foods did well to post a profit before tax of US$446 598 for the six months.
The group's industrial business recorded a 33 percent growth in turnover compared with the comparable period with Blue Star Logistics posting a profit before tax of US$208 314.
The group says although Polyfilm Plastics and Highfield Bag registered a volume growth of 16 percent there was significant capacity utilisation as a result of raw material supply constraints. resulting in a loss.
The property arm posted a profit before tax of US$155 816.
Source - TH
