HARARE – Government says it has increased its shareholding in Cottco to 51% which is in tandem with its contribution to the company.
Information Minister Monica Mutsvangwa told a media briefing that due to continued failure to pay farmers for cotton delivered to Cottco, it has decided to institute measures to increase its shareholding in the company to at least 51% in tandem with its contribution in the company and apparent support to farmers and the need to spur rural industrialization.
As a result, government will be paying farmers directly.
Cottco was once listed on the Zimbabwe Stock Exchange but is now owned by government through the Reserve Bank of Zimbabwe after a debt to equity swap in 2015, which allowed for the conversion of high interest debt of about US$56 million pusing bad debt-buying unit Zamco, to lower interest Treasury Bills.
Government currently holds 37.12% of the company.
Several companies have in the past expressed interest in Cottco including Surface Wilmar and business man Shingi Mutasa.
Cottco owes farmers about $1.5 bln from last season and while the new season commenced on May 18, 2021, farmers were yet to be paid for their deliveries.
In a related development, Mutsvangwa also announced that government’s final shareholding in Silo Foods Industries will be increased to 74% so as to guarantee availability of the seven basic commodities.
Government has also earmarked $4 billion under Presidential Inputs Scheme for grain production