Companies eye BDC failed glass project
Bame Piet | Thursday April 17, 2014 15:57
The project liquidator, Nigel Warren-Dixon, has said that so far, the two companies that prefer to remain anonymous have not made any offers. “They just indicated their interest. We have told them we are not ready now, unless the offer is too good to refuse,” he explained.
The glass project was a joint venture between Botswana Development Corporation (BDC) and a Chinese company. It was mired in controversy when it emerged that the management of BDC was pouring hundreds of millions in the project whose viability is in doubt. It was finally declared unfeasible last year and put in liquidation.
Dixon-Warren has said that when he came in, he found a big mess. Files were abandoned in a metal office container and they had to look for Chinese interpreters to assist in understanding the documents. Generally, there was poor record keeping in the project.
The liquidator held the first meeting with creditors at the end of March, and has since submitted a preliminary report to the Master and Registrar of the High Court. Among the creditors are Builders World, which is reportedly owed millions. The Botswana Unified Revenue Services (BURS) is also owed an undisclosed amount.
Warren-Dixon stated that they are treading carefully and they will engage the services of a technical advisor on how to handle certain things. The technical advisor will carry out an assessment of the project in the next three to six months. An additional six months may be needed for a comprehensive report to be submitted. “After the assessment, it will take time to draft terms of reference and compile a report and make a final decision on what to do,” Dixon-Warren explained.
Meanwhile, the new general manager of BDC, Bashi Gaetsaloe has indicated that the state corporation has moved on and written off the project, which gobbled over P500 million.
“There is a preliminary report. We have just started now, at the end of March, and we are going forward. We have handed the site over to the liquidator. In fact, all the creditors, including the taxman, the landboard and others, have ceded the site to the liquidator,” he said.
Strife within the BDC Subsidiaries
Can Manufacturing
Struggling to penetrate export market since inception and producing poor financial performance. Technically sound with 220 million units capacity per year, but yet to turn a profit.
LP Amusement Centre
Posted a P7 million loss in the year to March 2013. However, several projects are underway in order to boost the bottom line.
Golden Fruit
Plan underway to return the company to profitability, with close monitoring and thorough inspection of monthly progress. Company was once a model for successful citizen-grown enterprises.
Lobatse Clay Works
Production costs weighing down the company and reliance on narrow product line. Plan underway to diversify the company’s product range.
Turnaround strategy in place, following poor performance due to market-related stress. Company plans to introduce competitive pricing, premium brands and business diversification to corner the market