Sigwele blow
Isaac Pinielo | Monday April 27, 2015 16:52
This means that the company will be wound down and put under auction for any interested buyers. In February the company was placed under provisional liquidation following a high court petition by nine of its creditors.
The petition revealed that Delta Dairies owed Tswana Fuel and eight other companies close to P10 million in respect of services provided to the company, founded by citizen Dr Howard Sigwele. When the matter resumed last week, attorney representing Delta Dairies, Muller Keganne, who stood on behalf of Nancy Kiggundu, requested the high court to postpone the judgement for 30 days, stating that there were ongoing negotiations between the Delta Dairies and the creditors.
He also noted that there was another company that was willing to make payments to the creditors. However, Mboki Chilisa, attorney representing the creditors said he was not aware of any ongoing discussion between the parties, arguing that there was no need for postponement of the judgement since negotiations can be done even after the issuance of the judgement.
Delivering judgement, Lobatse High Court judge Abednico Tafa refused to give a postponement and went on to confirm that Delta Dairies should be liquidated.
Having opened its doors in 2008 with funding from the CEDA Venture Capital Fund, Delta Dairies financial woes have worsened over the years, resulting in CEDA capitalising it for 84 million Pula. CEDA would later convert their debts at the company into equity, living Sigwele with less than o.1 per cent of shareholding, until last year when CEDA decided to write off its debts at Delta dairies, resulting in Sigwele once again being the majority shareholder, but creditors who are owed over P20 million had already started court action seeking to be paid back.
How Sigwele’s only milk processing company sunk into oblivion boggles the mind, considering that since inception in 2008, the company enjoyed infant protection from government as it became the sole supplier of the annual P68 million milk tender for primary school feeding.
Despite public procurement support, Delta Dairies has battled to stay afloat over the years and has been producing milk intermittently since September last year. Meanwhile, the company owes creditors amounts in the form of P187,200 being fuel supplied by Tswana Fuel, P77,750 for professional services provided by BDO Services, P600,437.07 for cleaning chemicals and equipment supplied by VodaClean, P843,300.84 as salary arrears owed to Herman de Lange and Scharl Varnfield representing the over 54 workers that are owed salaries.
The other P175,479.38 is for goods sold and delivered by General Packaging Industries, P2,158,274.60 for UTI Botswana which provided freight forwarding services, P1,144,747,90 for money lent and advanced by Global Holdings Botswana, and P4,624,560.18 (R5,610,191.51) goods sold and delivered with services rendered by Tetra Pak South Africa.
Delta Dairies is said to have failed to pay the amounts they owed the creditors despite several demands and attempts made by the creditors, including attempts to attach some of the citizen-owned milk processing plant’s assets.
In August last year, the Registrar of the Industrial Court issued a Writ of Execution against the milk company after it failed to pay its employees the outstanding salaries.