TN Financial Holdings Ltd’s subsidiary company TN Management Services (Pvt) Ltd has filed an application seeking provisional liquidation and appointment of Christopher Maswi as a provisional liquidator, claiming “its entire share capital has become useless for the business of the company and is unable to pay its debts”.
BY CHARLES LAITON
The court application, for the winding up of a company in terms of the Companies Act, was filed last week by TN Management Services director, Mirriam Chimutsa.
“The basis upon which the present application is sought is that the company suspended its operations in 2006, its entire share capital became useless for the business of the company and it is unable to pay its debts,” Chimutsa said in her founding affidavit.
“For these reasons, the company has made a special resolution that it be wound-up by this honourable court as this will be just and equitable for the finalisation of the affairs of the company.”
In the application, Chimutsa said in 2009, TN Financial Holdings Limited (TNFHL) entered into a reverse takeover of Tedco Limited and in terms of the said reverse takeover, TNFHL shareholders exchanged their shares for shares in Tedco limited and changed its name to TN Holdings Limited.
Chimutsa said TN Holdings did not conduct any business using TN Management Services and it was later discovered that at the time of the reverse takeover and unbeknown to TN Holdings Limited, TN Management Services was defunct having ceased operating in 2006.
“I am advised by the applicant’s (TN Management Services) legal practitioners, that in terms of, section 206(c) of the Companies Act, a company that suspends its business for more than a year can be wound up on that basis. In the present matter, it is clear that the applicant has suspended its business for a period of more than 10 years and it is on that basis that the applicant should be wound up,” she said.
The director further said at the time of the reverse takeover TN Management Services shares were still denominated in the now defunct Zimbabwean dollar and due to the fact that the company has not been in operation since 2006, it did not have any working capital to resume its business.
“Attempts were made to revive the business of the applicant, as it is evidenced by the re-denomination of its shares in terms of a special resolution of the shareholders; however the shareholders have failed to re-capitalise the shares of the applicant,” she said.
“In the circumstances the entire paid up share capital of the applicant has been lost . . . and I am advised that this is a basis for the winding up of a company in terms of section 206(e) of the companies Act.”
Chimutsa said despite the fact that TN Management Services last carried out its business in 2006, it has been approached by some creditors claiming debts that occurred prior to the reverse takeover.
The matter is yet to be set down for hearing.