Ray of hope for Merlin

Published: 01 December 2017

STRUGGLING Bulawayo firm, Merlin, yesterday received a consignment of raw materials, thereby raising hopes for workers that the company will soon resume operations after being defunct for a decade.

NewsDay yesterday witnessed the delivery of 36 tonnes of yarn at the company's premises with workers also busy cleaning the place.

Merlin was placed under judicial management for a third time in December 2011 and Cecil Madondo of Tudor House was appointed judicial manager.

It also survived liquidation for the second time on June 30, 2017.

Workers who spoke to NewsDay expressed optimism that the company would resume operations anytime soon.

"This raises hopes that the company will be opened and we are very excited as workers. We are looking forward to seeing great things happening in this company," Evenson Sibanda, who served the company for 27 years, said.

Another employee, John Goora, who served Merlin for 35 years, said ever since the company was closed, they had not been working, anticipating that it would come back to life one day.

Responding to questions from NewsDay, Madondo said on September 27, 2017, he held a third meeting with the company's creditors and they resolved that the company should be operational by February 28, failure of which it would be liquidated.

Currently, Madondo has identified a number of unnamed credible potential investors and partners including a joint venture partner to inject working capital to resume operations before the end of the year.

In the meeting, Madondo said it was resolved that the judicial manager be given an opportunity to finalise the initiated negotiations to raise working capital and the signing of the joint venture agreement.

"(It was resolved that the judicial manager should) apply for leave to convene a scheme meeting with the objective of removing the company from judicial management into a scheme of arrangement within six to 12 months from date of resumption of operations," he said.

Madondo said in line with the implementation model for the proposed scheme of arrangement, the judicial manager was directed to finalise negotiations with the institutional investors to take up a controlling stake in the business.
- newsday

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