Published: 18 December 2013

GULLIVER Consolidated Limited is now firmly poised to bring in new equity investors or float a rights issue to raise funding required to clear liabilities to creditors following confirmation of Mr Reggie Saruchera as final judicial manager.

Mr Saruchera has been overseeing the recovery process of the company as provisional judicial manager, but will now move a gear up to turn the firm around amid revelations there is "enough interest from prospective (equity) investors".

Gulliver is struggling due to the depressed level of infrastructure development projects in Zimbabwe and was suspended from the Zimbabwe Stock Exchange in June 2012 after failing to produce financial results within the mandatory period.

It urgently requires funding to clear between $4million and $5 million creditors with financial obligations to about 100 of the firm's workers also top of the priority list.

Technically insolvent, the company has operated without a managing director for close to three years, but the judicial manager is hopeful an upturn in heavy infrastructure and engineering projects will lift its fortunes.

To that end, prospects include a number of key projects in Government's new economic plan, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation.

Mr Saruchera was recently confirmed final judicial manager having acted as provisional judicial manager since last year. He now has ample time and space to nurse it back to healthy state in terms of a viability plan he crafted for the firm.

Gulliver has over the years transformed into a steel engineering company. The group offers products and services ranging from the supply of all types of steel to fabrication of structural steel work, trailers, tankers, railway rolling stock, pressure vessels, hot dip galvanising and transport. While the industrial engineering company needs funding to clear different liabilities including to workers, the firm is most desperate to clear liabilities to creditors and a number of initiatives have been lined up to raise the required funds.

Grant Thornton Camelsa advisory manager Mr Bulisa Mbano said in terms of the company's viability plan the company had come up with a number of initiatives including equity injection, disposal of some identified assets and a rights offer.

A couple of assets have since been earmarked for disposal, although it was not clear which ones would be sold with the possibility of a sale and lease back arrangement.

He said the fact that Grant Thornton Camelsa partner Mr Saruchera had been confirmed final judicial manager meant a number of key turnaround initiatives would be rolled out with priority on paying off creditors.

In terms of raising fresh funding, Mr Mbano said, preference would be given "to current shareholders and if they cannot, we will go for an open tender for new investors".

"Gulliver is a business that depends on heavy infrastructure as well as industrial engineering and steel fabrication projects. Once projects pick up there is lots of prospects in Zim Asset and we think this will drive Gulliver," Mr Mbano said.

"Over and above that, we will bring in somebody who wants to invest (and inject funding) as we can't keep waiting because creditors want to be paid," he said.

The judicial manager will also look at streamlining operations to cut costs, but it was not immediately clear if this would affect workers with some on shifts.
- herald