×
NewsDay

AMH is an independent media house free from political ties or outside influence. We have four newspapers: The Zimbabwe Independent, a business weekly published every Friday, The Standard, a weekly published every Sunday, and Southern and NewsDay, our daily newspapers. Each has an online edition.

Liquidity constraints threaten IDC roadmap

News
THE Industrial Development Corporation (IDC) fears that the prevailing liquidity constraints will stall its plans to convert into a development financial institution.

THE Industrial Development Corporation (IDC) fears that the prevailing liquidity constraints will stall its plans to convert into a development financial institution amid indications there were no ready buyers for the subsidiaries put on sale.

Tarisai Mandizha

IDC wants to raise $100 million from the disposal of subsidiaries to be used as seed capital in the new role as a development financial institution.

In an interview with NewsDay, IDC chief executive officer, Mike Ndudzo said the company was moving away from its traditional role to development finance.

“We want to implement the new plan immediately, but liquidity is a challenge and buyers are few. So there is going to be delay, not because of the planning, but the conditions and finding buyers for these companies,” Ndudzo said.

“But if we take two years struggling to secure a buyer it will take two years to implement the new plan, but if we find buyers as soon as of yesterday we will implement immediately.”

Ndudzo said IDC had put a budget bid to Treasury through the parent ministry (Industry and Commerce) and did not succeed.

IDC has categorised its investment into four classes: dilution, disposal, dissolution and development.

Chemplex and Olivine were earmarked for dilution where IDC was inviting investors.

Almin Metal Industries, Zimbabwe Grain Bag and Stone Holdings were earmarked for disposal.

IDC controls more than 15 companies with interests across different industrial sectors.

Ndudzo said the company would also raise money through bonds or source from the region to play the role of a development finance institution.

“We want to move to play a role where basically we receive application for value addition and beneficiation projects from the public, assess the credit risk and provide funding for the medium and long term projects, just along the same line as Industrial Development Corporation of South Africa,” Ndudzo said.