The Sunday News
HARARE textile firm Paramount Garments is taking steps to start production at Archer Clothing in Bulawayo on a small-scale while the legal process that will pave way for a complete takeover of the Bulawayo company is still goingon, an official has said.
Paramount Garments managing director, Mr Jeremy Youmans, said despite the ongoing delays of the takeover process of Archer Clothing, the company was hoping to restart production in a few weeks.
“Paramount is taking steps to get some production going even given the situation and we hope to re-commence on a small-scale within the next couple of weeks. We can only do this on such a small scale while the legal posturing goes on,” said Mr Youmans.
Negotiations for the takeover of the troubled Bulawayo firm, which threw hundreds of workers onto the streets, started last year after the two textile firms initially entered into a Cut Make Trim (CMT) deal.
Under the CMT deal, Paramount Garments assisted with clothing material and labour while Archer Clothing chipped in with working space pending the liquidation process of the Bulawayo firm.
Judicial manager, Mr Phillip Ndlovu, attributed the delays to the legal process and said the papers had been filed with the courts.
Speaking on the latest developments, Mr Youmans said the courts were still to approve another meeting of creditors so that the correct voting position could be taken.
“Based on the last position we are aware of, there is only one creditor who is voting against the scheme and their lawyers want things delayed until their own court case is heard. Meanwhile, the workers are at home waiting for the outcome, nothing is being manufactured and export orders are being missed,” he said.
Archer Clothing was laid low due to a myriad of problems which included a harsh economic environment and a liquidity crunch which has seen several local firms close or listed in critical condition.
The company was placed under judicial management in 2010 after being seriously hit by a shortage of working capital, obsolete machinery, power challenges and cheap imports which remain major constraints crippling viability of industries in Bulawayo.
In the same year, the clothing company scaled down operations, laying off 270 contract workers and 210 permanent employees.
The revival of the company would be welcome news for the industry, which at its peak, used to produce about 135 million garments annually, compared to the present 18,7 million garments.
The industry employed 35 000 workers compared to about 7 000 now.
Efforts to get the textile sector back on track are on with private players organising conferences aimed at assisting companies like David Whitehead, Textile Mills and Merlin to get funding.
