Innscor Africa Ltd. (INN), Zimbabwe’s biggest food company, said it’s complying with indigenization laws while the government gave it a seven-day deadline to offer a plan to abide by them or face punishment including a shutdown.
The National Indigenization and Economic Empowerment Board said it sent a letter to the Harare-based company which Innscor Chief Executive Officer John Koumides may have been motivated by a national election President Robert Mugabe has said he wants to be held in March.
“We have complied with the indigenization laws a long time ago,” he said in a telephone interview from the capital, Harare. “Somebody is playing games with that letter. It’s old. As we approach elections, these things will always pop up.’
Zimbabwe in 2010 introduced a law that requires foreign and white-owned domestic companies with more than $500,000 in assets to sell or cede 51 percent to black Zimbabweans. The law first targeted mining companies and was later extended to foreign- owned banks and other enterprises.
The country has the world’s largest platinum deposits after neighboring South Africa. Gold, diamonds, ferrochrome, coal, copper and asbestos are some of the minerals mined there by companies such as Impala Platinum Holdings Ltd.’s (IMP) Zimplats unit, Aquarius Platinum Ltd. (AQP) and Sinosteel Corp.
The government can have Innscor’s operating licenses revoked until it complies, Zwelibanzi Lunga, the Indigenization board’s director for compliance, said. The letter’s deadline expired ‘‘sometime in December,” he said.
“Innscor should just comply with our laws,” he said by telephone from Harare today. “To start with, 98% of its directors are non-indigenous and they are white persons, so it’s silly for anybody to tell us they are compliant. Anyone who doesn’t want to comply can pack up and go.”
The company owns fast-food outlets in several African nations and also controls National Foods Holdings Ltd. (NTFD), a milling company, in partnership with Johannesburg-listed. Innscor operates Spar grocery shops across Zimbabwe. The company also owns Colcom Holdings Ltd. (COLC), Zimbabwe’s biggest pork producer, and Padenga Holdings Ltd. (PHL), a crocodile-hide exporter.
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