Insiders at the companys head office in Southerton said the investor, believed to be from South Africa, was expected to inject a significant amount which would have seen the company resuming full production on November 1, but the investor backtracked in unclear circumstances.
The shareholders, who had pinned their hopes on the South African investor to resuscitate operations at the troubled company, have re-directed their hopes on a local financial institution for a long term financial bail out.
We were made to believe that an investor would be coming on the 1st of November and production was supposed to increase to 60 000 loaves per day from but nothing materialized from the look of things. Part of the money was supposed to go towards paying workers salaries and procure raw materials said a company insider.
The company is facing severe liquidity problems which have been blamed on poor management and corruption. The company has also been besieged by creditors with some having attached company property including delivery vehicles as it struggles to pay off debts owed to several suppliers.
Lobels bakery was founded in 1950 by the Lobels brothers who later sold the bread making unit to a consortium of local business people who include Frederick Mtandah, Retired Brigadier Chiweza, Livingstone Gwata and Herbert Nkala.
The bakery founding CEO Burombo Mudumo, Finance Director Nesbert Gufu and Treasurer Tonderai Chipere were shown the gate on allegations of misappropriation of close to US$10 million in September.
Workers at the troubled firm who last received their salaries in September were last month paid US$150 as the company struggles to clear off the salaries arrears.
Post published in: News