By Business Reporter
A new investor has been granted the green light to recapitalise David Whitehead Textiles after a recent High Court ruling which dismissed the challenge by former shareholders.
The long protracted litigation case involving former David Whitehead shareholders and the textile firm’s judicial manager had resulted in the new investor developing cold feet to proceed with revival efforts.
However, a recent high court ruling in favour of the judicial manager is expected to pave way for turnaround efforts to resume.
“The judicial manager’s mandate is coming to an end and the company is now in a strong financial footing to warrant that it can be constituted as a legal entity,” said Knowledge Hofisi, Judicial Manager, David Whitehead.
The judicial manager is set to flight a statutory notice this week providing an opinion on the financial and technical evaluation of the company which is now out of the woods.
“A statutory notice on Friday will be flighted and a 21 day reprieve will pass when an application will be done to remove the company from judicial management,” he added.
Years of plunder by former shareholders plunged the once mighty textiles giant into financial distress and the Second Republic has prioritised its reopening to revitalise the country’s textiles value chain.
David Whitehead woes began around 2004 when the company – weighed by operational challenges and saddled with huge debts, was first placed under judicial management.
Since then, it remained under the High Court-ruled reconstruction under different administrators
David Whitehead Textiles (DWT) is the largest textile company in Zimbabwe, producing the highest quality products from some of the finest cotton in the world.
The company used to produce about 20 million metres of fabric per year, while directly employing 4 000 workers and thousands in down and upstream industries.