News / National
Mutapa to acquire drug producer CAPS Holdings
14 Oct 2024 at 08:10hrs | Views
Zimbabwe's sovereign wealth fund, the Mutapa Investment Fund, is set to acquire local healthcare and drug manufacturing giant CAPS Holdings, despite a Supreme Court ruling earlier this year overturning a High Court decision that had granted the State control of the company. The acquisition, reported by The Herald Finance & Business, is viewed by the Government as a strategic move to maintain CAPS as a critical national asset.
CAPS Holdings, which includes subsidiaries such as St Anne's Hospital, CAPS Manufacturing, and QV Pharmacies, has been at the center of a long-running ownership dispute. In 2015, the Government entered into a share purchase agreement with CAPS' beneficial owner, Mr. Fred Mutanda, who holds an 88% controlling stake in the company. However, the deal later fell through, and Mr. Mutanda alleges that subsequent actions by the Government were nullified due to the collapse of the agreement.
In February 2024, the Supreme Court ruled in favor of Mr. Mutanda, overturning a previous High Court order that had handed ownership of CAPS to the State, including the power to appoint board directors. Despite this, Government officials maintain that CAPS remains a strategic entity, and the acquisition is being pursued through the Mutapa Investment Fund.
According to a letter sent by Industry and Commerce Secretary Dr. Utete Wushe to Mr. Mutanda, the Government intends to address the matter through Mutapa. "After a thorough review, we have been informed that your matter will be handled by the Mutapa Fund. The Mutapa Fund is a reputable financial institution with a proven track record in managing complex transactions," the letter stated.
Mr. Mutanda confirmed receiving the communication and noted that formal negotiations with Mutapa will begin once the matter has been officially transferred. "I can confirm receiving the letter you are referring to, but formal engagements with Mutapa will only begin once the transfer of the matter has been officially completed," he said.
No comment was available from Mutapa's chief executive officer, Dr. John Mangudya, at the time of publication.
Mutapa, established by an Act of Parliament, is Zimbabwe's sovereign wealth fund and serves as a strategic investment arm of the Government. It manages a diverse portfolio across sectors, including mineral resources, energy, ICT, transport, agriculture, financial services, and real estate. The fund aims to bolster the country's economic growth and contribute to the National Development Strategy and Vision 2030, which seeks to increase GDP and per capita income.
The acquisition of CAPS by Mutapa is expected to not only safeguard a vital healthcare provider but also stimulate economic development, generate employment, and enhance the nation's resilience. As the companies under Mutapa become profitable, they will lessen their reliance on Government funding, freeing up resources for other national priorities.
CAPS Holdings, which includes subsidiaries such as St Anne's Hospital, CAPS Manufacturing, and QV Pharmacies, has been at the center of a long-running ownership dispute. In 2015, the Government entered into a share purchase agreement with CAPS' beneficial owner, Mr. Fred Mutanda, who holds an 88% controlling stake in the company. However, the deal later fell through, and Mr. Mutanda alleges that subsequent actions by the Government were nullified due to the collapse of the agreement.
In February 2024, the Supreme Court ruled in favor of Mr. Mutanda, overturning a previous High Court order that had handed ownership of CAPS to the State, including the power to appoint board directors. Despite this, Government officials maintain that CAPS remains a strategic entity, and the acquisition is being pursued through the Mutapa Investment Fund.
According to a letter sent by Industry and Commerce Secretary Dr. Utete Wushe to Mr. Mutanda, the Government intends to address the matter through Mutapa. "After a thorough review, we have been informed that your matter will be handled by the Mutapa Fund. The Mutapa Fund is a reputable financial institution with a proven track record in managing complex transactions," the letter stated.
Mr. Mutanda confirmed receiving the communication and noted that formal negotiations with Mutapa will begin once the matter has been officially transferred. "I can confirm receiving the letter you are referring to, but formal engagements with Mutapa will only begin once the transfer of the matter has been officially completed," he said.
No comment was available from Mutapa's chief executive officer, Dr. John Mangudya, at the time of publication.
Mutapa, established by an Act of Parliament, is Zimbabwe's sovereign wealth fund and serves as a strategic investment arm of the Government. It manages a diverse portfolio across sectors, including mineral resources, energy, ICT, transport, agriculture, financial services, and real estate. The fund aims to bolster the country's economic growth and contribute to the National Development Strategy and Vision 2030, which seeks to increase GDP and per capita income.
The acquisition of CAPS by Mutapa is expected to not only safeguard a vital healthcare provider but also stimulate economic development, generate employment, and enhance the nation's resilience. As the companies under Mutapa become profitable, they will lessen their reliance on Government funding, freeing up resources for other national priorities.
Source - The Herald
