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Phelekezela Mphoko never invested a cent in the Choppies business

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Phelekezela Mphoko

Former Vice President Phelekezela Mphoko did not invest a cent in the Choppies business whose majority ownership belongs to the Botswana-headquartered retail group, chief executive officer, Mr Ramachandran Ottapathu, has revealed.

Responding to recent squabbles over the control of Choppies Zimbabwe, pitting former VP Mphoko’s family and its Botswana business partners, Mr Ottapathu said Choppies Enterprises belongs to the Botswana firm, which invested $25 million to set up the business.

In a letter, issued through a consultancy to different media houses in Zimbabwe, he said the media narrative about Choppies boardroom fights has lacked appreciation of real substance around the controversy.

“We have, as a business, had a situation where there have been boardroom challenges, which do not in any way affect the running of the business.

The matters at boardroom level are matters that are now in the public domain and are also matters that are in the courts of law in Zimbabwe,” said Mr Ottapathu.

“As a matter of fact, we would like to state…that Choppies operations in Zimbabwe are owned, in the main, by Choppies Enterprises Limited, a company registered in Botswana.

“The reference of the 51 per cent being owned by Mphokos was done so as to comply with legislation, which was put in place by the Government, which precluded foreigners from owning big stakes in businesses in preference to locals.

That legislation is being looked at as we write to you because of the vision that the Government has to open up the business sector and promote investment.”

Choppies runs 34 branches in Zimbabwe and had indicated plans to increase its local network to 60.

The company employs in excess of 2 000 workers

President Mnangagwa’s Government has since reviewed the Indigenisation and Economic Empowerment Act and clarified that the 51-49 per cent requirement only applies to natural resource-based investments.

As such, Mr Ottapathu said, as Choppies they did nothing else than answer the Zimbabwean government’s call to come and invest in Zimbabwe.

“We have had the family of the former VP of the Republic of Zimbabwe, Phelekezela Mphoko, whom we entered into a partnership with, now refuting that we are the owners of the business because they are using paperwork that was done in order to comply with legislation that was in place,” said Mr Ottapathu.

He said they have documentation to prove they invested $25 million, which was underwritten by Barclays Bank of Botswana, for the setting up of the Choppies Zimbabwe operation.

“We also reiterate that the Phelekezela Mphoko was given the 51 per cent shares in an agreement which allows us to comply with the law. Phelekezela Mphoko never invested any cent in the business. We gave them the shares on paper,” said the Choppies CEO.

“Their seven per cent free carry shares was a way of thanking them for facilitating that we set up business in Zimbabwe. The other 44 per cent shares were allotted to them (the Mphokos) to add to the seven per cent free carry shares to make it 51 per cent. But that is merely on paper.”

According to the shareholder agreement that was signed to facilitate the setting up of the business under Zimbabwean law at the time, Mr Ottapathu said the 44 per cent shares “can be called back” at any minute at no cost to Choppies Enterprises, thus leaving Mphokos with their seven per cent share.

“The seven per cent free carry shares can be bought back by Choppies Enterprises at US$1 per share in the event that we want Mphokos out of the business altogether. We have not yet reached that stage yet,” he said.

“For the record, Siqokoqela Mphoko and his father, who are shareholders of Nanavac, have all along been getting dividends through their bank accounts for the seven per cent shares they hold and not the 51 per cent. We have proof of transfer and we can furnish you if you so wish.”

Mr Ottapathu said there were machinations to seek to wrestle the Choppies Enterprises from its owners through peddling misleading narratives about the company. He said the business partners know the truth although some are now trying to take advantage of the situation to twist facts in their favour.

“All the important and crucial stakeholders know who holds what percentage in the company. They also know who invested what. They also have documents that talk to these issues”.

Meanwhile, last week Siqokoqela was arrested and remanded in custody after he violated bail conditions by harassing State witnesses. He is facing 170 counts of fraud and theft.

It is alleged that as country managing director, he hijacked the Choppies retail business and “looted” more than $50 000 worth of cash and goods from the outlets countrywide without board approval.

Despite these squabbles, Mr Ottapathu said Choppies remains committed to continuing serving the Zimbabwean market.

“All this drama is not worth the energy that they have put into it. We would rather have the energy being devoted to the growth of the business,” he said.

The Chronicle

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INTERNATIONAL

African Union’s Inclusion in G20: A Significant Acknowledgment of a Continent with 1 Billion Inhabitants

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african-union-g20

The world’s most powerful economies, the G20, have welcomed the African Union (AU) as a permanent member, recognising Africa’s more than 50 countries as important players on the global stage. US President Joe Biden and Indian Prime Minister Narendra Modi both expressed support for the AU’s permanent membership.

The AU has advocated for full membership for seven years and, until now, South Africa was the only African country in the G20. The AU represents a continent with a young population of 1.3 billion, which is set to double by 2050 and make up a quarter of the world’s population.

Africa’s 55 member states have long pushed for meaningful roles in global bodies, including the United Nations Security Council, and want reforms to the global financial system. The continent is increasingly attracting investment and political interest from global powers like China, Russia, Gulf nations, Turkey, Israel, and Iran. African leaders are challenging the framing of the continent as passive victim and want to be brokers instead.

They seek fairer treatment by financial institutions, delivery of rich countries’ long-promised $100 billion a year in climate financing for developing nations, and a global tax on fossil fuels. The AU’s full G20 membership will enable it to represent a continent that’s home to the world’s largest free trade area and abundant resources needed to combat climate change. The African continent has 60% of the world’s renewable energy assets and over 30% of the minerals key to renewable and low-carbon technologies.

African leaders want more industrial development closer to home to benefit their economies. Finding a common position among the AU’s member states, from economic powers to some of the world’s poorest nations, can be challenging, but Africa will need to speak with one voice to influence G20 decision-making. African leaders have shown their willingness to take collective action, as seen during the COVID-19 pandemic. As a high-profile G20 member, Africa’s demands will be harder to ignore.

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BUSINESS

Forging Strong Bonds: Iran and Zimbabwe Deepen Economic Ties in Raisi’s Africa Tour

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Zimbabwe and Iran

On Thursday, Zimbabwe and Iran signed 12 memorandums of understanding to strengthen their bilateral ties during Iranian President Ebrahim Raisi’s visit to Africa. Raisi had previously visited Kenya and Uganda before meeting with Zimbabwean President Emmerson Mnangagwa in Harare. Among the 12 MOUs is a plan to establish a tractor manufacturing plant in Zimbabwe with the help of an Iranian company and a local partner. The two countries also signed agreements for cooperation in energy, agriculture, pharmaceuticals, and telecommunications, as well as research, science, and technology projects.

Mnangagwa expressed his appreciation for investments in several sectors of Zimbabwe’s economy to reporters after the signing ceremony. However, he did not disclose the amount of investment Zimbabwe is expecting from Iran. Raisi mentioned the economic challenges facing Iran and Zimbabwe due to U.S. sanctions but emphasised his country’s efforts to build closer economic ties.

According to Iran’s foreign ministry, trade with Africa is expected to exceed $2 billion this year, but there was no comparison to the previous year’s figures. This African visit is the first by an Iranian leader since 2013, following a visit to three Latin American countries in June, all of which are also affected by U.S. sanctions.

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BUSINESS

Breaking News: E-Creator Fraud Ring Leader Apprehended by Police

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Zhao Jiaotong

The Zimbabwe Republic Police is requesting that individuals who have been deceived by E-Creator, Zhao Jiaotong come forward and report to the nearest police station.

According to police spokesperson Assistant Commissioner Paul Nyathi, the kingpin of the E-Creator Ponzi scheme has been arrested on charges of fraud. The suspect is identified as Chinese national Zhao Jiaotong, who is said to be the founder of the notorious platform that has scammed people out of thousands of dollars.

Nyathi stated, “The Zimbabwe Republic Police confirms the arrest of Zhao Jiaotong, 39, in connection with a case of fraud in which unsuspecting members of the public were duped through the E-Creator Ponzi scheme.”

The police are urging anyone who may have fallen victim to E-Creator to report to their nearest police station. Additionally, the public is encouraged to exercise caution and perform thorough research before investing in any Ponzi or pyramid schemes that promise quick returns.

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